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U.S. Court In New Jersey Holds Publishing Reports Of Medical Malpractice Judgments Does Not Violate Privacy Rights


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 profile.

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).


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