Roxanne Rieder and Tony Rieder v. David Segal, M.D., Theodore Donta, M.D., PH.D, Eastern Iowa Brain and Spine Surgery, PLLC, Radiology Consultants of Iowa, PLC and Mercy Hospitals, Cedar Rapids, Iowa, d/b/a Mercy Medical Center, Cedar Rapids, Iowa ( 2021 )

IN THE SUPREME COURT OF IOWA
No. 19–0767
Submitted February 16, 2021—Filed May 14, 2021
ROXANNE RIEDER and TONY RIEDER,
Appellants,
vs.
DAVID SEGAL, THEODORE DONTA, EASTERN IOWA BRAIN & SPINE
SURGERY, PLLC, RADIOLOGY CONSULTANTS OF IOWA, PLC and
MERCY HOSPITAL, CEDAR RAPIDS, IOWA d/b/a MERCY MEDICAL
CENTER, CEDAR RAPIDS, IOWA,
Appellees.
________________________________________________________________________
Appeal from the Iowa District Court for Linn County, Ian K.
Thornhill, Judge.
The defendants seek further review of a court of appeals decision
reversing the district court’s grant of summary judgment in a negligent
credentialing case. COURT OF APPEALS DECISION VACATED;
DISTRICT COURT JUDGMENT REVERSED AND REMANDED.
McDonald, J., delivered the opinion of the court, in which all justices
joined.
Bruce L. Braley (argued), Brian N. Aleinikoff, Benjamin I. Sachs,
and Timothy J. Luetkemeyer of Leventhal Puga Braley P.C., Denver, CO,
for appellants.
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Christine L. Conover (argued), Carrie L. Thompson, and Dawn M.
Gibson of Simmons Perrine Moyer Bergman PLC, Cedar Rapids, for
appellees.
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McDONALD, Justice.
Plaintiffs Roxanne and Tony Rieder filed suit against Mercy Medical
Center for the negligent credentialing of Dr. David Segal after Ms. Rieder
suffered complications following surgical procedures performed by
Dr. Segal. A majority of jurisdictions recognize the tort of negligent
credentialing, but Iowa is not one of them. This court has addressed the
tort in a prior decision, but the court did not adopt the tort at that time.
See Hall v. Jennie Edmundson Mem’l Hosp., 812 N.W.2d 681, 685 (Iowa
2012) (“We assume without deciding that the tort is actionable in this
state. As we find no reversible error in any of the district court’s
rulings . . . we need not decide the question whether the tort is
actionable.”). In this case, the parties and the district court assumed the
plaintiffs’ negligent credentialing claim against Mercy was cognizable in
Iowa. The district court granted Mercy’s motion for summary judgment.
The court of appeals reversed the judgment of the district court, and we
granted Mercy’s application for further review. For the reasons set forth
below, we vacate the court of appeals decision, reverse the judgment of the
district court, and remand this matter for further proceedings.
I.
We review the grant of summary judgment for correction of errors at
law. Susie v. Fam. Health Care of Siouxland, P.L.C., 942 N.W.2d 333, 336
(Iowa 2020). The grant of summary judgment is appropriate “if the
pleadings, depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no genuine issue as
to any material fact and that the moving party is entitled to judgment as a
matter of law.” Id. (quoting Iowa R. Civ. P. 1.981(3)). In reviewing the
district court’s decision, we look at the summary judgment record in the
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“light most favorable to the nonmoving party.” Hedlund v. State, 930
N.W.2d 707, 715 (Iowa 2019).
II.
On May 8, 2015, Dr. Segal performed an anterior cervical
discectomy with fusion and a microscopic lumbar laminectomy on
Roxanne Rieder. In other words, Dr. Segal performed upper neck and
lower back surgery. In the days immediately after the surgery, Rieder
experienced severe pain originating in her lower back and down the back
of her leg. She was unable to lift her left leg out of the hospital bed. She
reported increasing pain, weakness, numbness, and tingling in her left leg.
Dr. Segal decided he had to perform additional procedures to “fix” Rieder.
Four days after he performed the original procedures, Dr. Segal performed
a lumbar decompressive laminectomy and decompression of the nerve
roots. More generally, Dr. Segal performed a surgical reexamination of
Rieder’s lower back to relieve pressure and alleviate pain. Three days after
the second surgical procedure, Rieder was discharged from the hospital.
After being discharged, Rieder continued to experience symptoms
including neck pain, left arm pain and numbness, intermittent shooting
right arm pain, left foot drop, and pain and paresthesia extending into the
buttocks, thighs, and calves in both legs. She treated with other
physicians to address these symptoms.
On the same day Rieder was discharged from the hospital, the Iowa
Board of Medicine (IBM) filed a statement of charges against Dr. Segal
related to medical care he provided to patients other than Rieder. The
charges stated Dr. Segal “demonstrated professional
incompetency . . . when he failed to provide appropriate neurosurgical
care to numerous patients in Cedar Rapids, Iowa.” IBM investigations are
confidential. See Iowa Admin. Code r. 653—24.2(8) (2015). As a result,
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the charges were not public until May 15, 2015 when the IBM issued their
formal statement of charges. However, Dr. Segal admitted he informed
Mercy of the IBM’s pending investigation at some point prior to Rieder’s
surgery on May 8, 2015.
The IBM charges were resolved against Dr. Segal in December 2016.
Dr. Segal agreed to cease practicing surgery in Iowa. In a press release
issued in December 2016, the IBM stated, “Dr. Segal discontinued his
surgical practice due to his health condition of Parkinsonism, which
impacts the steadiness of his hands during surgery. . . . Dr. Segal agreed
that he will not engage in the practice of surgery under his Iowa medical
license.”
The Rieders filed this suit a few days prior to the IBM announcing
the resolution of the charges against Dr. Segal. In their suit, the Rieders
asserted claims for medical negligence against Dr. Segal and another
physician as well as claims for negligent credentialing against the clinics
and hospitals that employed or credentialed the doctors. The Rieders
settled and dismissed their claims against all defendants except Mercy. As
to Mercy, the Rieders alleged: (1) Mercy “was negligent in credentialing
Dr. Segal as a member of its staff in that it failed to exercise reasonable
care in investigating and selecting medical staff to permit only competent
and qualified physicians the privilege of using its facilities”; (2) Mercy
“knew, or should have known, that Dr. Segal did not possess the proper
professional competency to practice”; and (3) Mercy’s negligent
credentialing of Dr. Segal caused Ms. Rieder’s injuries.
There are two summary judgment rulings at issue in this appeal.
Mercy first moved for partial summary judgment on the ground “there is
no duty for the hospital to take immediate action with regard to a doctor’s
privileges upon finding out there is an open investigation by the Board of
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Medicine.” The Rieders resisted the motion, relying on the opinion of their
expert witness, Dr. Charles Pietrafesa. Dr. Pietrafesa opined,
based on the Iowa Medical Board’s allegations[ and] the
testimony of Dr. Segal that he alerted Mercy about these [IBM]
allegations, the standard of care required Mercy to take swift
and immediate action to limit, restrict, or suspend Dr. Segal’s
privileges with respect to care of any patients at Mercy at that
time, including but not limited to Ms. Rieder, even on a
conditional or temporary basis.
The district court granted Mercy’s motion for partial summary
judgment, holding “[d]efendant Mercy Hospital did not owe a duty to
suspend or revoke Dr. Segal’s credentials or privileges at the hospital in
any way based solely upon the knowledge that an investigation had been
opened by the Iowa Board of Medicine.” (Emphasis added.) The district
court continued, “Mercy Hospital, without knowing the basis of the
investigation, could not have had a duty to ‘restrict or terminate Dr. David
Segal’s surgical privileges’ as of May 8, [2015] because it could not have
known nor should it have known that he posed a serious risk to his
patients, as the formal charges had not been filed yet and no final decision
had been made.”
After the district court entered its order, the parties continued on
with motion practice and further discovery. In his deposition and
supplemental disclosure, Dr. Pietrafesa opined Mercy breached the
standard of care because it did not conduct an investigation into
Dr. Segal’s competency when it should have done so and, had it conducted
an investigation, Mercy more likely than not would have suspended
Dr. Segal’s privileges prior to Dr. Segal performing procedures on Rieder.
Dr. Pietrafesa clarified his opinion was not based solely on the IBM’s
investigation announced in May 2015. Instead, his opinion was based on
numerous facts that should have put Mercy on alert: Dr. Segal was sued
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for medical malpractice on numerous occasions, including the years 2004,
2005, 2006, 2007, 2008, 2014, and 2015; due to concerns regarding his
competency, Dr. Segal was sent to the Center for Personalized Education
for Physicians (CPEP) in 2012; and the IBM issued subpoenas for records,
credentialing information, and complication rates that should have alerted
Mercy to a potential issue.
Mercy filed a motion to strike the supplemental opinion and a
second motion for summary judgment. Mercy argued evidence of the prior
malpractice suits was not admissible and could not be considered for the
purposes of summary judgment. Without this evidence, Mercy argued,
there was no evidence in support of the plaintiffs’ negligent credentialing
claim. The district court agreed with Mercy on both points. First, after
performing a balancing test under Iowa Rule of Evidence 5.403, the district
court concluded “the probative value of evidence that Dr. Segal had been
sued in the past, without any evidence as to the nature or results of those
lawsuits, is substantially outweighed by the danger of unfair prejudice to
Mercy as well as the danger of misleading the jury.” The district court held
evidence of the prior lawsuits was inadmissible as was Dr. Pietrafesa’s
opinion testimony to the extent it relied on the prior lawsuits. In the
absence of the opinion evidence, the district court concluded there was no
evidence in support of the Rieders’ claim and granted Mercy’s motion for
summary judgment.
The court of appeals reversed the judgment of the district court. The
court of appeals concluded the district court’s use of rule 5.403 to
determine the admissibility of the evidence “amounted to an impermissible
weighing of the evidence.” Because weighing the evidence is for the fact
finder, the court of appeals reasoned, the district court erred in granting
summary judgment. We granted Mercy’s application for further review.
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III.
Iowa’s appellate courts have not resolved the question of whether
the tort of negligent credentialing is cognizable in this state. In Hall v.
Jennie Edmundson Memorial Hospital, we assumed without deciding the
tort was cognizable. See 812 N.W.2d at 685. We declined to resolve the
issue because “the defendants ha[d] not claimed the tort should not be
recognized and we prefer[red] to confront and decide the issue in a case in
which the matter [was] disputed and briefed by the parties.” Id. at 685
n.4. In Day v. Finley Hospital, the court of appeals discussed the tort of
negligent credentialing while acknowledging this state had not yet
recognized such a claim. 769 N.W.2d 898, 901–02 (Iowa Ct. App. 2009).
Day did not explicitly adopt the tort. See id.While it might be more expeditious to resolve the issue in this case,
we decline to do so. As in Hall, Mercy did not dispute the existence of the
tort in the district court. Mercy assumed, without conceding, a negligent
credentialing claim is viable. The question of whether a negligent
credentialing tort is viable was never presented to or ruled on by the
district court. See Meier v. Senecaut, 641 N.W.2d 532, 537 (Iowa 2002)
(stating issues must be raised and decided in the district court). As in
Hall, Mercy does not challenge the viability of the tort on appeal. To the
contrary, Mercy is adamant that it does not seek a ruling on the viability
of the tort. Instead, it assumes such a tort is viable and seeks affirmance
of the district court’s summary judgment ruling that there is no evidence
to support a negligent credentialing claim.
Amici do request a ruling on the issue: the Iowa Hospital
Association, the American Medical Association, and the Iowa Medical
Society argue we should not recognize the tort while the Iowa Association
for Justice argues we should recognize the tort. We decline amici’s request
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because reviewable issues must “be presented in the parties’ briefs, not an
amicus brief.” Martin v. Peoples Mut. Sav. & Loan Ass’n, 319 N.W.2d 220,
230 (Iowa 1982) (en banc).
Accordingly, for the purpose of this appeal, we assume without
deciding the tort of negligent credentialing is cognizable.
IV.
We must determine the contours of the tort to determine whether
there is a genuine issue of material fact for the fact finder. In determining
the contours of the tort, we take guidance from other states. Twenty-eight
states recognize negligent credentialing as a cause of action. See Peter
Schmit, Cause of Action for Negligent Credentialing, 18 Causes of Action
(Second) § 10, at 338–43 (2002) (listing the states that recognize the tort
of negligent credentialing); Sean Ryan, Negligent Credentialing: A Cause of
Action for Hospital Peer Review Decisions, 59 How. L.J. 413, 421 (2016);
see also Larson v. Wasemiller, 738 N.W.2d 300, 306–07, 306 n.3, 307 n.4
(Minn. 2007) (en banc) (“At least 27 states recognize the tort of negligent
credentialing, and at least three additional states recognize the broader
theory of corporate negligence,” which encompasses the tort of negligent
credentialing. (footnote omitted)).
Generally, a plaintiff must show three things to establish a negligent
credentialing claim: (1) the hospital failed to exercise reasonable care in
granting privileges to the physician to practice medicine, or their specialty,
at the hospital; (2) the physician breached the standard of care that a
reasonably competent and skilled health care professional, with a similar
background and in the same medical community, would have provided
while rendering medical care and treatment to the plaintiff; and (3) the
hospital’s failure to exercise due care in permitting their physician to
practice at the facility was the proximate cause of the plaintiff’s injuries.
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See generally, Benjamin J. Vernia, Annotation, Tort Claim for Negligent
Credentialing of Physician, 98 A.L.R.5th 533 (2002) (containing a wealth of
authority on the issue); see also Rule v. Lutheran Hosps. & Homes Soc’y of
Am., 835 F.2d 1250, 1253 (8th Cir. 1987) (identifying the elements of a
negligent credentialing claim); Insinga v. LaBella, 543 So. 2d 209, 214 (Fla.
1989) (same); Frigo v. Silver Cross Hosp. & Med. Ctr., 876 N.E.2d 697, 723
(Ill. App. Ct. 2007) (same); Martinez v. Park, 959 N.E.2d 259, 272 (Ind. Ct.
App. 2011) (same); Crockerham v. La. Med. Mut. Ins., 255 So. 3d 604, 608
(La. Ct. App. 2018) (same); Tharp v. St. Luke’s Surgicenter-Lee’s Summit,
LLC, 587 S.W.3d 647, 654–57 (Mo. 2019) (en banc) (same); Schelling v.
Humphrey, 916 N.E.2d 1029, 1033–34 (Ohio 2009) (same).
Mercy argues the district court correctly granted its first motion for
partial summary judgment because it had no duty to investigate Dr. Segal
based solely on the knowledge that the IBM opened an investigation into
Dr. Segal. We disagree. Mercy conflates the issues of duty and breach.
The duty in this case is inherent in and created by the tort itself. To the
extent there is a negligent credentialing tort, the hospital always has a
duty to exercise reasonable care in granting privileges to physicians. See
Tharp, 587 S.W.3d at 655 (“[A] hospital’s undertaking—its duty—is to
credential competent and careful physicians.”); see also Rule, 835 F.2d at
1253; Hous. Hosps., Inc. v. Reeves, 846 S.E.2d 219, 221 (Ga. Ct. App.
2020); Schelling, 916 N.E.2d at 1033. A hospital must act as a reasonable
hospital to satisfy the duty. Mercy’s argument actually goes to whether it
breached the duty of reasonable care in not conducting an investigation
based solely upon receiving notice the IBM opened an investigation into
Dr. Segal. The district court erred in conflating these issues and
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concluding Mercy had no duty to exercise reasonable care under the
circumstances.
Even though the district court erred on this point, the error is now
largely academic. Whether Mercy breached the duty of reasonable care in
not conducting an investigation based solely upon notice the IBM opened
an investigation is no longer material to the resolution of this case. As
noted above, it is no longer plaintiffs’ theory of the case that Mercy
breached the duty of care based solely on Mercy’s failure to investigate on
notice of the pending IBM charges. The plaintiffs’ expert witness has
opined that Mercy breached its duty of care by not initiating its own
investigation in response to several other facts that should have placed
Mercy on alert to inquire further, including the existence of numerous
malpractice suits filed against Dr. Segal.
This brings us to whether the district court erred in granting Mercy’s
second motion for summary judgment on the plaintiffs’ more robust theory
of the case. In ruling on Mercy’s second motion for summary judgment,
the district court held evidence of prior malpractice suits against Dr. Segal
and Dr. Pietrafesa’s opinion regarding breach of the standard of care
based, in part, on the prior lawsuits was inadmissible under rule 5.403.
We disagree with the district court’s resolution of the motion.
It is true that prior lawsuits against a defendant are generally
inadmissible in medical malpractice lawsuits.
The fact of prior litigation has little, if any, relevance to
whether [a doctor] violated the applicable standard of care in
the immediate case. The admission of evidence of prior suits,
instead of aiding the fact finder in its quest, tends to excite its
prejudice and mislead it.
Lai v. Sagle, 818 A.2d 237, 247 (Md. 2003) (emphasis added); see also
Gray v. Allen, 677 S.E.2d 862, 867 (N.C. Ct. App. 2009) (“[E]vidence of
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prior lawsuits against a defendant in a medical malpractice action is not
relevant to whether a physician was negligent in the current case.
Furthermore, evidence of a prior negligence action against defendants
threatens substantial prejudice to the defendants.” (citation omitted)).
However, evidence of prior lawsuits may be admissible under some
circumstances in negligent credentialing claims because the existence of
prior lawsuits may be directly relevant to the hospital’s credentialing
decision. See Corrigan v. Methodist Hosp., 869 F. Supp. 1208, 1211 (E.D.
Pa. 1994) (finding an expert’s opinion criticizing the hospital for
credentialing surgeons either with knowledge of, or failing to learn of,
malpractice claims in their history sufficed to raise an issue of material
fact that precluded summary judgment); Mat-Su Valley Med. Ctr., LLC v.
Bolinder, 427 P.3d 754, 761 n.13 (Alaska 2018) (noting proof that the
hospital should have known the physician would act negligently “generally
consists of ‘evidence that the physician either lacked standard credentials
or previously had been the subject of a malpractice suit or disciplinary
proceedings’ ” (quoting Ward v. Lutheran Hosps. & Homes Soc’y of Am.,
Inc., 963 P.2d 1031, 1033 n.2 (Alaska 1998))); Towner v. Bernardo, 467
P.3d 17, 33 (Or. Ct. App. 2020) (“[I]t is at least plausible that a plaintiff
could obtain proof from third parties, public records, or other sources to
try to demonstrate that a hospital should have provided greater oversight
to a surgeon who, for instance, had a history of prior negligence in
particular surgeries.”); Neeble v. Sepulveda, No. 01–96–01253–CV, 1999
WL 11710, at *6 (Tex. App. Aug. 13, 1998) (concluding the rules of
evidence prohibited the introduction of prior malpractice suits in the
medical malpractice action against the doctor but that evidence was
admissible in the trial of the negligent credentialing claim). For example,
in Schelling v. Humphrey the court held evidence of prior lawsuits was
admissible in a negligent credentialing claim but not in the related
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malpractice claim. See 916 N.E.2d at 1036. To prevent unfair prejudice
to the physician, the court concluded a bifurcated trial was appropriate.
See id. Bifurcation “avoids the problems of jury confusion or prejudice
that may result from admitting evidence of prior acts of malpractice in a
combined trial on both claims.” Id.
Regardless, the district court incorrectly framed the question in
ruling on the motion for summary judgment. The relevant question is not
whether evidence of the prior lawsuits against Dr. Segal was admissible;
the relevant question presented is whether Dr. Pietrafesa’s opinion
regarding the standard of care based, in part, on his knowledge of the prior
lawsuits was admissible. On that question, we conclude Dr. Pietrafesa’s
opinion regarding the standard of care and breach of the standard of care
was admissible.
Iowa Rule of Evidence 5.702 allows expert opinion testimony “if the
expert’s scientific, technical, or other specialized knowledge will help the
trier of fact to understand the evidence or to determine a fact in issue.”
Iowa Rule of Evidence 5.703 provides:
An expert may base an opinion on facts or data in the
case that the expert has been made aware of or personally
observed. If experts in the particular field would reasonably
rely on those kinds of facts or data in forming an opinion on
the subject, they need not be admissible for the opinion to be
admitted.
This court has recognized three possible sources from which an
expert may testify: “(1) the firsthand observation by the witness; (2) from
information obtained at trial through hypothetical questions or the
testimony of other witnesses; and (3) the presentation of data to the expert
outside of court and other than by his own perception.” Brunner v. Brown,
480 N.W.2d 33, 34 (Iowa 1992). The facts need not be admissible in
evidence so long as they are “of a type reasonably relied on by other experts
in the field.” Id. at 35. Whether the underlying facts are of a type
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reasonably relied upon is decided by the court. See id. The proponent
must demonstrate that the information is customarily relied upon by
experts in their field and that such information is sufficiently reliable. See
State v. Neiderbach, 837 N.W.2d 180, 205 (Iowa 2013); Franzen v. Kruger,
No. 18–0850, 2019 WL 4678152, at *4–5 (Iowa Ct. App. Sept. 25, 2019).
The grounds for admissibility have been satisfied here. There is no
dispute evidence of prior lawsuits filed against Dr. Segal are reliable—one
could easily verify the previous claims. The second determination is
whether other experts in the medical field would rely on prior lawsuits in
determining whether a hospital was negligent in credentialing its
physician. We conclude they would. See, e.g., Corrigan, 869 F. Supp. at
1211; Mat-Su Valley Med. Ctr., LLC, 427 P.3d at 761 n.13; Malcolm v.
Duckett, No. L–10–1110, 2011 WL 686398, at *7 (Ohio Ct. App. Feb. 25,
2011) (allowing the expert to conclude “two or more deaths due to
negligence is sufficient to establish a ‘pattern’ which should put the
credentialing hospital on notice that there may [be] a problem with that
physician’s performance”); Towner, 467 P.3d at 33; Neeble, 1999 WL
11710, at *6. Thus, Dr. Pietrafesa’s opinion testimony, even if it relied on
the fact that Dr. Segal had previously been sued in Iowa, Maryland, and
New York, was admissible.
Assuming the existence of the tort, we also conclude Dr. Pietrafesa’s
opinion, as a whole, as expressed in his affidavit and expert disclosures,
created a disputed issue of material fact. See Brookins v. Mote, 292 P.3d
347, 364 (Mont. 2012) (“The plaintiff in a negligent credentialing claim
must present expert testimony establishing that the defendant deviated
from the applicable standard of care to raise a genuine issue of material
fact.”). As relevant here, the summary judgment record shows
Dr. Pietrafesa would have testified as follows:
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[W]hen the Iowa Board of Medicine subpoenas records and/or
credentialing information and/or complication rates of a
surgeon from a hospital, if the doctor in question has had
multiple lawsuits filed against him over a span of years . . . ,
and if the Iowa Board of Medicine is investigating multiple
complaints based on care over many years against the same
physician . . . , and if the care in question from those
complaints was so substandard as to require the doctor to be
sent to a program for a competency evaluation . . . , and if the
physician affirmatively tells the hospital that he has received
multiple inquiries from the Iowa Board of Medicine as it
related to his care . . . , the standard of care requires the
hospital to contact the doctor and conduct their own
investigation into the doctor’s competency. The evidence in
this case, however, is that Mercy did nothing in response to
this information . . . .
Dr. Pietrafesa also opined that in failing to respond, Mercy breached the
standard of care. He further opined if Mercy had not breached the
standard of care, it would have, more likely than not, restricted or
suspended Dr. Segal’s privileges.
We thus conclude the district court erred in granting Mercy’s second
motion for summary judgment. The district court erred in ruling
Dr. Pietrafesa’s expert opinion evidence regarding the standard of care
based, in part, on prior lawsuits was inadmissible in a negligent
credentialing claim. The opinion evidence was relevant to show Mercy
should have known Dr. Segal posed a serious risk to his patients and
Mercy was negligent in granting and maintaining his surgical privileges at
its facilities.
V.
We vacate the decision of the court of appeals and reverse the
judgment of the district court and remand this matter for further
proceedings.
DECISION OF COURT OF APPEALS VACATED; DISTRICT COURT
JUDGMENT REVERSED AND REMANDED.