Thursday, December 01, 2022

plaintiffs fail to show Lexmark proximate cause where D's statements were part of a larger public controversy

McNeil v. Mount Carmel Health Sys., No. 2:20-cv-258 (S.D. Ohio Nov. 29, 2022)

Plaintiffs, eight former Mount Carmel nurses and one former Mount Carmel pharmacist, worked with and around a Dr. Husel, whose employment termination and subsequent criminal proceedings were highly publicized. Plaintiffs alleged that Mount Carmel engaged in a false advertising campaign aimed at convincing the general public that Dr. Husel, with plaintiffs’ assistance, either harmed or killed up to 35 actively dying patients with excessive pain medication. They sued for defamation, wrongful termination, and false advertising under both the Lanham Act and the Ohio Deceptive Trade Practices Act. The court found lack of statutory standing on the Lanham Act claim and declined to exercise jurisdiction over the state-law claims.

Some additional facts: The PR firm retained to help strategize about the investigation into Dr. Husel’s dosing practices advised Mount Carmel of a concern that it lacked policies or standards governing medications and dosages in connection with withdrawals of non-palliative care for dying patients. The firm “noted that criminal charges against Dr. Husel or any of the nurses would be helpful to Mount Carmel and Trinity Health’s public perception.” Eventually, the public PR strategy included the key message “The acts of this doctor, along with the involved clinical staff, were a clear violation of how we care for patients at Mount Carmel.” The PR strategy identified key audiences including both internal (e.g., Mount Carmel’s board, executive leaders, and employees and doctors) and external (e.g., patients, regulators elected officials, local and national media, and Catholic leaders). Along with other public comments, Mount Carmel announced that “48 nurses and pharmacists,” a group encompassing all the plaintiffs here, were “under review” and had been placed on administrative leave. It eventually announced that its investigation was complete, and that it was terminating a number of involved employees. Media coverage also generally mentioned the staff, and so did lawsuits, although a number of nurses were dismissed from lawsuits.

Plaintiffs alleged that, as the result of Mount Carmel’s public statements, each one of them “faced significant impediments to obtaining similar work following his or her exit from Mount Carmel.”

The alleged damage to their professional reputations was damage to a commercial interest that brought plaintiffs within the zone of interests covered by the Lanham Act. But proximate cause was a fatal hurdle. The statements made by Mount Carmel were only part of the public discourse: “numerous parties made numerous public statements concerning Dr. Husel, making it ‘impossible to trace a straight line’ from Defendants’ statements to the media to the employment decisions of Plaintiff’s prospective employers.” [Here the court recounts lots of attacks on Dr. Husel, but the quoted materials don’t mention the staff, by name or otherwise, which makes reliance on them a bit thin.] “Plaintiffs fail to explain why Defendants’ statements, rather than the plethora of other attention-grabbing public statements (many of which arose from separate investigations into Dr. Husel), determined the hiring decisions of Plaintiffs’ prospective employers.”

Likewise, prospective employers “exercised their independent judgment” when declining to hire plaintiffs. [This seems to directly conflict with Lexmark, which points out that false advertising always involves a consumer deciding to act differently because of [allegedly false] information and that this decision can’t therefore remove proximate cause.] But plaintiffs couldn’t “disentangle the alleged reputational harm caused by Defendants’ statements from the other public statements discussed above, as well as the ‘unique combination of internal and external variables’ that drive hiring decisions.”

The remaining claims were thus remanded to state court (removal had been based on the Lanham Act claim).


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