February 4th, 1999

Precedential

97-8290

                                  United States Court of Appeals,

                                          Eleventh Circuit.

                                      Nos. 97-8290, 97-8291.

                        David G. CAMPBELL, M.D., Plaintiff-Appellant,

                                                  v.

EMORY CLINIC, A Partnership, Emory University, H.D. Cavanagh, M.D., Charles R. Hatcher,
M.D., Defendants-Appellees.

               J. Allen GAMMON, M.D., Plaintiff-Counter-Defendant, Appellant,

                                                  v.

 EMORY CLINIC, A Partnership, Emory University, Charles R. Hatcher, M.D., Defendants-
Appellees,

                 H.D. Cavanagh, M.D., Defendant-Counter-Claimant, Appellee.

                                            Feb. 4, 1999.

Appeals from the United States District Court for the Northern District of Georgia. (Nos. 1:90-CV-
1403-HTW, 1:91-CV-3030-HTW), Horace T. Ward, Judge.

Before TJOFLAT, Circuit Judge, and GODBOLD and HILL, Senior Circuit Judges.

       HILL, Senior Circuit Judge:

       For disposition, we consolidate these two appeals.1 The allegations upon which both

complaints were based are virtually identical. They both have been subject to years of protracted

litigation. Upon careful review of the record, we find only two issues remaining. One is procedural;

one is substantive. First, the district court did not abuse its discretion in denying motions filed by



   1
    Campbell and Gammon filed separate complaints in the district court. They were
represented by the same counsel. Although the cases contained common questions of law and
fact, they were not consolidated by the district court until November 22, 1996, upon defendants'
motion. Campbell and Gammon dismissed all remaining claims on March 20, 1997. At oral
argument the cases were argued together.
appellants David G. Campbell, M.D. and J. Allen Gammon, M.D. for leave to amend their

complaints to assert a breach of fiduciary duty claim against the individual appellees, H.D.

Cavanagh, M.D. and Charles R. Hatcher, M.D. Second, as a substantive matter, the district court did

not err in granting summary judgment in favor of the appellees, individual or otherwise, on

appellants' claims for tortious interference with business relations and conspiracy to tortiously

interfere. Based upon the following, we affirm the judgments of the district court.

                               I. PROCEDURAL BACKGROUND

       Campbell filed his complaint in 1990. Gammon filed in 1991. Both plaintiffs alleged,

among other things, that certain of the defendants possessed questionable medical abilities and used

fraudulent billing practices for medical procedures. When plaintiffs "blew the whistle," they

alleged, the defendants breached various legal duties to them to cover up improper actions.

Plaintiffs each alleged numerous federal and state claims.2 While the complaints contained a claim

for breach of the duty of good faith against Emory Clinic, they did not contain separate claims for

breach of fiduciary duty against Hatcher and Cavanagh, individual defendants, and partners in the

Emory Clinic.3

       Years of litigation followed. Then, in October 1994 (in the Campbell case), and March 1995




   2
    These included claims against all four defendants for tortious interference with business
relations and conspiracy to tortiously interfere; claims against Emory University alone for
breach of contract and breach of the duty of good faith; claims against Emory Clinic alone for
breach of the partnership agreement and breach of the duty of good faith. Additional antitrust
and other claims have been separately disposed of on appeal (Nos. 96-8543 and 96-8544) and are
not part of this appeal.
   3
   It is interesting to note that, unlike the breach of good faith counts, the tortious interference
counts are styled separately, in the name of each defendant, individual or otherwise.
(in the Gammon case), the appellees moved for summary judgment.4 In support of its motions, the

appellees argued that undisputed facts demonstrated that appellants' claims were based upon

self-serving conclusory allegations or hearsay, or that the conduct alleged was privileged. On July

27, 1995 (Campbell ), and August 22, 1995 (Gammon ), the district court granted the appellees'

motions for summary judgment.

       In response, Campbell (August 1995) and Gammon (September 1995) each moved for partial

reconsideration of the summary judgment orders, alleging for the first time according to the

defendants, a breach of fiduciary duty claim against Hatcher and Cavanagh. Defendants claim that

plaintiffs recast their breach of good faith claim against the Emory Clinic as a claim for "the tortious

breach of the duty of good faith by the Clinic partners." Plaintiffs asserted that their now

voluminous pleadings contained a breach of fiduciary claim against these individual defendants.

       In the procedural confusion that ensued,5 the first reaction of the district court, on September

28, 1995, was to reconsider its orders of July 27 (Campbell ) and August 22 (Gammon ), grant

plaintiffs' motions for partial reconsideration, and find the breach of fiduciary duty claim to be in

the cases. Six months passed. Upon reflection, the district court corrected its own mistake. It found

that neither Gammon (March 21, 1996) nor Campbell (June 6, 1996) had pled a breach of fiduciary

duty claim against the individual defendants and dismissed the claim in both cases. Then, on June

6, 1996, the district court, again on its own motions, reinstated summary judgment for appellees.

       Plaintiffs were not deterred. On June 20, 1996, they moved for leave to amend their

complaints to assert claims for breach of fiduciary duty, arguing that these claims "had been part of


   4
    Summary judgment was sought on numerous claims, including the tortious interference with
business relations and the conspiracy to tortiously interfere claims.
   5
    The district court admonished counsel for both parties for providing the court with
inconsistent briefs, resulting in inconsistencies between the two cases.
the case" for six months—that is, the six months that passed before the district court corrected its

mistake on its own motion.

        In its discretion, on August 26, 1996, the district court denied plaintiffs' motions to amend,

stating that they "ha[d] not brought, and may not bring, a breach of fiduciary duty claim against

defendants Hatcher and/or Cavanagh." This consolidated appeal follows.

                                 II. FACTUAL BACKGROUND6

        Campbell and Gammon are physicians specializing in ophthalmology. Campbell was a

tenured associate professor at Emory University Medical School7 and a partner in the appellee

Emory Clinic (Clinic).8 Gammon was an assistant professor on a tenure track at the medical school

and also a partner in the Clinic. Hatcher9 and Cavanagh10 are also faculty members of the medical

school and Clinic partners.

        The underlying lawsuits have their origins in 1982 when Campbell and Gammon actively

assumed the role of whistleblowers as to Cavanagh's medical ability. This foreshadowing

culminated in September 1983, when Cavanagh operated on the wrong eye of a patient.11 At a


   6
    We provide a brief overview of the facts of the underlying lawsuits for the reader's benefit,
although not germane to our discussion of the amendment issue discussed in Part IV.A of this
opinion.
   7
    Appellee Emory University operates the medical school as a private Atlanta institution.
   8
    Emory Clinic is affiliated with Emory University.
   9
    Hatcher was not an ophthalmologist but from 1976 to 1984 was department chairman and
section head of the Cardiothoracic Surgery Section and a Clinic director. In 1984 he became
Emory Clinic's chief financial officer, vice president of health affairs for Emory University and
medical center director.
   10
   Cavanagh was an ophthalmologist who served as department chairman and section head of
Emory Clinic's ophthalmology section.
   11
     This case resulted in a substantial settlement. The publicity generated by the case caused
the filing of ten or eleven more malpractice cases.
faculty meeting three days later, Campbell called for a review of the surgery. Gammon seconded

the motion. As a result, the Waring Committee,12 was convened to investigate the surgery and issue

a report. When it did, Campbell and Gammon were not satisfied and continued actively to voice

their concerns. Two years later, another committee, the Tindale Committee,13 was convened to

review Cavanagh's practice.

          Ironically, yet allegedly unrelated, on the same day the Tindale Committee issued its report,

Campbell was reprimanded by the Clinic director for repeatedly making and discussing allegations

about Cavanagh's medical abilities with ophthalmologists all over the country, outside the University

family. Campbell resigned and joined the faculty of Dartmouth College and became a member of

its affiliated clinic.

          During this same time frame, Gammon's career took a similar tack. Ironically, it was

Cavanagh who began to express concerns about Gammon's ability to achieve tenure based upon the

number and quality of Gammon's publications. For what was to be a two-year term, Gammon

switched to a clinical (versus tenure) track professor with hopes to improve his academic standing.

In addition, Gammon applied for and received two extensive research grants. Gammon thought this

would improve his academic standing. The University thought otherwise. On what it perceived to

be an over-commitment to research, the University undertook to accommodate the research

commitment by decreasing Gammon's clinical practice, moving him to another hospital.14


   12
        The Waring Committee was composed of tenured Emory Clinic ophthalmologists.
   13
    The Tindale Committee was a pre-existing professional standards and ethics committee
made up of chairmen and professors from various departments (excepting ophthamology) within
the medical school.
   14
    Emory University decided that Gammon would have to give up his administrative
appointments as chief of pediatric ophthalmology and chief of ophthalmology at Henrietta
Egleston Hospital, the children's hospital at Emory University. It also decided that Gammon
          Gammon asserted that he felt "evicted." He claims these changes were due to his whistle

blowing activities regarding Cavanagh's medical practice. University claims its actions were based

upon legitimate business reasons.

          Gammon then requested and received a one-year leave of absence for the second year of his

two-year term. He accepted a job in Saudi Arabia. At the end of the two-year term, the University

did not renew his appointment on the faculty and Gammon was automatically withdrawn from the

Clinic.

                                   III. STANDARD OF REVIEW

          We review the denial by the district court of plaintiffs' motions to amend their complaints

under an abuse of discretion standard. Lockett v. General Finance Loan Co. of Downtown, 

623 F.2d

1128

, 1130 (5th Cir.1980). We review the grants of summary judgment by the district court de

novo. Jaques v. Kendrick, 

43 F.3d 628

, 630 (11th Cir.1995).

                                         IV. DISCUSSION

A. The Amendment to the Complaint Claims

          Count XI of Campbell's amended complaint and Count XII of Gammon's complaint are titled

"Breach of Duty of Good Faith by Defendant Clinic." Cavanagh and Hatcher were not named as

defendants in this count. They did not undertake to answer it. Paragraph 100 of Campbell's

amended complaint (paragraph 115 of Gammon's complaint) reads in full "Defendant Clinic owed

certain duties to Plaintiff, including the duty to act in good faith and duty of fairness. Defendant

Clinic, acting by and through various of its Partners, breached these duties owed to Plaintiff."

(Emphasis added). The next paragraph in each complaint states that "As a direct and proximate




would have to move from the new Emory Eye Center to Crawford Long Hospital, another of the
locations of the department of ophthalmology.
result of the Clinic's breach of duty Plaintiff has suffered actual damages in an amount to be shown

upon the trial of this case." (Emphasis in original). The last paragraph of this count reads:

        The actions and conduct of Defendant Clinic herein alleged were intentional, malicious,
        intended to injure, and in bad faith, therefore demanding imposition of punitive damages
        against Defendant Clinic and entitling Plaintiff to recover his expense of litigation, including
        attorneys fees, in such amounts as shall be determined by the jury upon trial of this case.

Nowhere in any of the paragraphs of the counts are mentioned the names of Hatcher or Cavanagh;

neither does the term "fiduciary" appear.

        First, appellants argue, apparently invoking the doctrine of notice pleading, that these

individuals, must have been aware of the claims asserted against them and the grounds upon which

they rest, especially in view of the language "acting by and through various of its Partners." See

Fed.R.Civ.P.R. 8(a); Leatherman v. Tarrant County Narcotics Intelligence and Coordination Unit,

507 U.S. 163

, 168, 

113 S.Ct. 1160

, 

122 L.Ed.2d 517

 (1993). We conclude, however, under the

notice pleading doctrine, that the complaints failed to provide notice to Hatcher, Cavanagh, or the

court, that a claim for breach of fiduciary duty was asserted against these two individuals under

either complaint.15

        Next, appellants argue a type of virtual reality, more closely akin to the "Emperor's new

clothes." They seize upon the error made earlier by the district court, and assert that the claims were

"in the case" because they and the court had been proceeding as such for six months, from the Fall

of 1995 to the Spring of 1996. Appellants contend that the court record is virtually littered with

references to these claims in briefs and motions filed by them with the court. See Foster Medical

Corp. Employees' Pension Plan v. Healthco, Inc., 

753 F.2d 194

, 197 (1st Cir.1985) (where claim


   15
     See Foster Medical Corp. Employees' Pension Plan v. Healthco, Inc., 

753 F.2d 194

, 197
(1st Cir.1985); Vidimos, Inc. v. Laser Lab Ltd., 

99 F.3d 217

, 222 (7th Cir.1996). See also
Plumbers & Steamfitters Local No. 150 v. Vertex Const. Co., 

932 F.2d 1443

, 1448 (11th
Cir.1991).
was sufficiently pled even though not specifically pled in complaint in light of references in

opposition to summary judgment). They reiterate this "implied litigation" theory by pointing to the

fact that these claims were in the proposed pretrial order and that the district court recognized the

claims to be in the case when it reconsidered and denied summary judgment. We are not

persuaded.16

        Third, appellants point out that leave to amend "shall be freely given when justice so

requires," See Fed.R.Civ.P.R. 15(a) and the cases so holding.17 They claim that disallowance of the

amendment elevated technical pleading skills over the substantive merits of their cases and the

district court abused its discretion in denying their motions to amend.

        Rule 15(a) gives a district court "extensive discretion" to decide whether or not to allow a

party to amend a complaint. Hargett v. Valley Federal Sav. Bank, 

60 F.3d 754

, 761 (11th Cir.1995).

This liberal discretion is not abused when the amendment would prejudice the defendant, follows

undue delays, or is futile. Technical Resource Services, Inc. v. Dornier Medical Systems, Inc., 

134

F.3d 1458

, 1463-64 (11th Cir.1998). Prejudice and undue delay are inherent in an amendment

asserted after the close of discovery and after dispositive motions have been filed, briefed, and

decided. Jameson v. Arrow Co., 

75 F.3d 1528

, 1534 (11th Cir.1996).

        Here, these motions for leave to amend were filed more than one year after discovery had


   16
     Of course, there would naturally be references to this "claim" during the six months that the
district court erroneously thought it in the cases.
   17
     Davis v. Piper Aircraft Corp., 

615 F.2d 606

, 612-14 (4th Cir.1980)(where the rules were
designed to adjudicate actions on their merits, not on technical aspects of pleading); United
States v. Hougham, 

364 U.S. 310

, 317, 

81 S.Ct. 13

, 

5 L.Ed.2d 8

 (1960) (where the pleadings
should facilitate a proper decision on the merits, not be a game of skill where one misstep decide
the outcome); Foman v. Davis, 

371 U.S. 178

, 182, 

83 S.Ct. 227

, 

9 L.Ed.2d 222

 (1962)(where
leave to amend should be "freely given" in the absence of reasons such as undue dely, bad faith
or dilatory motive, repeated failure to cure deficiencies by previous amendment, undue
prejudice, etc.).
ended, after dispositive motions had been filed, and between five-and-six years after the lawsuits

were begun.18 The facts upon which the claims for breach of fiduciary duty against the individual

defendants were based were available at the time the complaints were filed. We conclude the district

court did not abuse its discretion in denying the motions to amend. Amendment at the late date

offered would have been futile, caused undue delay and expense, and resulted in unfair prejudice

to the individual defendants. 

Id.


B. Grant of Summary Judgment on Employment Related Issues

          Under our de novo review, we conclude that the merits of this substantive issue have been

thoroughly analyzed by the district court in its orders of July 27, 1995 (Campbell ) and August 22,

1995 (Gammon ), granting summary judgment to appellees on appellants' tortious interference and

conspiracy to tortiously interfere claims; reinstating summary judgment on June 6, 1996; and

denying appellants' motions to amend on August 26, 1996.19

          There are no genuine issues of material fact, summary judgment is appropriate, and the

appellees are entitled to judgment as a matter of law. We applaud the tenacity of the district court

in its handling of these needlessly confusing cases and affirm this issue based upon these orders of

the district court.

                                           V. CONCLUSION

          We conclude that the district court did not abuse its discretion in denying appellants' motions

for leave to amend to assert breach of fiduciary duty claims against the individual appellees. Neither



   18
     Early in the case, Campbell was twice granted leave to amend his complaint to assert fraud
and antitrust claims, with the district court expressly noting that the case was still in discovery,
that dispositive motions had not been filed, and that there would be "no delay in this matter
which will unduly prejudice defendants."
   19
        See also Part I supra.
did it err in granting summary judgment to appellees on the tortious interference with business

relations claims and conspiracy to tortiously interfere. The judgment of the district court, in each

case, is

           AFFIRMED.