Kadlec Medical Center v. Lakeview Anesthesia Associates

Dr. Robert Lee Berry was a practicing anesthesiologist and shareholder in Lakeview Anesthesia Associates, L.L.C. (Lakeview) (defendant). Berry also had staff privileges at Lakeview Regional Medical Center (LRMC). In March of 2001, Berry failed to respond to several pages while on a 24-hour shift at LRMC. Berry was found sleeping in a chair and “appeared to be sedated.” Based on this incident and suspicions that Berry was stealing Demerol from the hospital, he was terminated from Lakeview, and his LRMC staff privileges were revoked. Berry then sought employment through an employee-placement agency, which placed Berry with Kadlec Medical Center (Kadlec) (plaintiff). Prior to Berry's employment at Kadlec, the facility sent a letter to LRMC requesting recommendations and evaluations of Berry’s skills and abilities. Kadlec also included a questionnaire with specific questions that it wanted LRMC to answer. In response to the letter, LRMC sent Kadlec a short letter stating only that Berry was on staff between specific dates. No further information was given, and LRMC did not answer any of the questions on the questionnaire. Based on LRMC’s letter and the recommendations provided by Berry’s former colleagues at Lakeview, Kadlec hired him. Approximately one year later, Berry performed a surgical procedure at Kadlec while he was impaired by drugs. The patient suffered severe brain damage from the procedure, and her family sued Kadlec for medical malpractice. During discovery in that action, Kadlec learned that Berry had been fired from Lakeview for cause. Kadlec settled the medical-malpractice case and then filed suit against Lakeview, its shareholders, and LRMC alleging intentional, negligent, and strict-responsibility misrepresentation and negligence based on LRMC’s omission of material facts in the letter to Kadlec. LRMC moved for summary judgment. The district court, which had diversity jurisdiction over the action pursuant to 28 U.S.C. § 1332, applied the substantive law of the forum state, Louisiana, in deciding the motion.