HLD, v. 32, n. 7 (July 2004)
U.S. Court In New Jersey Holds Publishing Reports Of Medical Malpractice
Judgments Does Not Violate Privacy Rights
Plaintiff Medical Society of New Jersey sued Mary Lou Mottola the
Executive Director of the Medical Practitioner Review Panel and Reni Erdos the
Director of the Division of Consumer Affairs (defendants) seeking a preliminary
injunction barring defendants from publishing medical malpractice settlement
information about New Jersey doctors. Plaintiff also sought to enjoin defendants
from disclosing to the publication The Record certain medical malpractice payment
information. In 2003, the New Jersey Legislature enacted the New Jersey Health
Care Consumer Information Act (Act), N.J. Stat. Ann. � 45:9-22.21 et seq.,
which became effective June 23, 2004, and requires the Division of Consumer
Affairs to create and make available to the public profiles of New Jersey physicians
and podiatrists, including information about medical education, hospital privileges,
and similar information. The Act also provides that part of the physician profile
include information on medical malpractice judgments, and not include information
on pending malpractice actions. The Act provides that each profile will include
a statement that no negative inferences should be drawn from information in
The state has reporting requirements at � 17:30D-17, which requires
insurance companies and individuals to report to the Medical Practitioner Review
Panel (Panel) information about medical malpractice insurance actions.
The federal government enacted the Health Care Quality Improvement
Act of 1986 (HCQIA), which requires certain information about medical malpractice
actions, payments, and sanctions to be reported to the federal government. The
regulations promulgated under HCQIA established the National Practitioner Data
Bank (Data Bank) to collect the information. HCQIA includes confidentiality
provisions, and insurance carriers must provide information to the Data Bank.
In August 2003, The Record filed a show cause order against New
Jersey, the Division of Consumer Affairs, and the Medical Practitioner Review
Panel (Review Panel) seeking to compel the disclosure of payment notices that
malpractice insurers must by law submit to the Review Panel about medical malpractice
liability payments. The trial court granted common law access to the payment
notices to The Record. The trial court ordered the release of all undisputed
notices to The Record by May 11, 2004.
On May 6, 2004, in a separate action, plaintiff filed a show cause
order seeking a temporary restraining order and preliminary injunction enjoining
defendants from disclosing the information to The Record as required by the
trial court's order. Plaintiff's claims included invasion of privacy under HCQIA,
constitutional violations, and state and federal law violations. In May 2004
the trial court ordered The Record, which was not a party to the current case,
and defendants to file opposition papers after The Record consented to a stay
of the order in its earlier case. The trial court granted The Record's motion
to intervene. Defendants cross-moved to dismiss the complaint.
The U.S. District Court for the District of New Jersey denied plaintiff's
motion for preliminary injunctive relief and denied defendants' motion to dismiss.
As an initial matter the court determined that plaintiff had standing to bring
the case and rejected defendants' argument that plaintiff did not have associational
standing because plaintiff had the right to seek relief on behalf of its members
and the relief was not particularized to each member and there was no need for
individual members to appear in court.
Defendants argued their motion to dismiss should be granted because
they had immunity from plaintiff's action under the Eleventh Amendment, and
plaintiff argued its claim for injunctive relief came within the Eleventh Amendment
exception under Ex Parte Young, 209 U.S. 123 (1908) for claims of ongoing
violations of federal law that seek prospective relief. Plaintiff contended
that its claims of privacy violations were based on HCQIA and constitutional
claims, and thus its claims came within the Ex Parte Young exception.
The court agreed and held defendants were not immune from suit on the federal
claims, but that plaintiff's state law claims were barred by the Eleventh Amendment.
The court also rejected defendants' argument that it should abstain from hearing
the case under Younger v. Harris, 401 U.S. 37 (1971). The Younger
case holds that a federal court should abstain from hearing a case when there
is an ongoing state proceeding that implicates important state interests and
there is an opportunity during the proceedings to raise constitutional issues.
The court concluded that the state proceeding was over, there was no appeal,
and plaintiff had no opportunity to present its federal claims in state court
and thus abstention did not apply. Defendants contended that plaintiff's claims
were precluded by the Rooker-Feldman doctrine, which bars litigation of claims
that were already litigated in state court or if the claim is "inextricably
intertwined" with the state action. Other courts have held that the Rooker-Feldman
doctrine only applies if the plaintiff was a party in the state court proceeding,
said the court, and because plaintiff was not a party in the state court the
Rooker-Feldman doctrine did not apply.
The court then turned to plaintiff's argument that the Act in conjunction
with the state law reporting requirements at � 17:30D-17 violate the federal
privacy rights provided by HCQIA. This is not a case of federal pre-emption,
said the court, because each federal and state system of information collection
is separate and the HCQIA cannot make information that a state agency collects
independently confidential. Plaintiff argued about the retroactive effect of
the Act in light of two state laws restricting the dissemination of medical
malpractice information, but the court refused to address the issue because
it was an issue of state law barred by the Eleventh Amendment.
Plaintiff also agued that the Act was unconstitutional under the
Contract Clause because it requires the disclosure of information that is subject
to confidentiality provisions of existing contracts. The Act does not impair
the obligation of contracts because � 17:30D-17 provides that information about
any medical malpractice award must be disclosed to the State Board of Medical
examiners, and any contract barring disclosure of that information is void.
The court also found the Act did not impair medical malpractice agreements because
confidentiality is only a collateral effect of a settlement and the primary
purpose of medical malpractice settlements is to resolve disputes. The court
also rejected plaintiff's right to privacy argument because plaintiff failed
to show that the right to privacy in this case was a fundamental privacy right.
Plaintiff contended the Act treated doctors unfairly because it
requires settlement information about doctors to be disclosed, but not settlement
information involving other professionals. The court rejected plaintiff's argument
because to allege an equal protection claim plaintiff would have to show that
doctors are treated differently than others similarly situated and the state's
decision to treat doctors differently was based on race, religion, or other
arbitrary classification. Plaintiffs failed to allege doctors were treated differently
by the state for any of those reasons. The court determined that plaintiff failed
to allege that the Act violated federal law, and thus plaintiff was not entitled
to a preliminary injunction.
Plaintiff also argued its members were not parties to the earlier
court case, and it would be unfair to enforce the court's order because it would
harm them without giving them due process. Plaintiff's members could have intervened
in the earlier action, the court concluded, and made no effort to challenge
the outcome. The information that is being disclosed under the court order is
on the public record, said the court. Therefore, the court denied plaintiff's
motion for an injunction. Defendants filed a cross-motion to dismiss plaintiff's
complaint, and the court dismissed the complaint for failure to state a claim
upon which relief could be granted.
Medical Soc'y of N.J. v. Mottola, No. 04-2126 (WGB), 2004
WL 1246015 (D.N.J. June 8, 2004).