Preview
YORK OUN Kk 04 Dv INDEX NO. 156138/2014
NYSCEF BOC. NO. 107 RECEIVED NYSCEF 03/30/2015
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK.
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BERTON FORMAN, M.D. Index No. 156138/2014
Plaintiffs,
-against-
MERCY MEDICAL CENTER and CATHOLIC HEALTH
SERVICES OF LONG ISLAND
Defendants.
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PLAINTIFF’S MEMORANDUM OF LAW IN OPPOSITION TO
DEFENDANT MERCY MEDICAL CENTER’S MOTION TO
DISMISS AND FOR OTHER RELIEF AND IN SUPPORT OF
CROSS-MOTION
Law Offices of Kenneth L. Kutner
Attorney for Plaintiff Berton Forman, M.D.
1185 Avenue of the Americas
New York, NY 10036
(212) 684-0088
TABLE OF CONTENTS
TABLE OF AUTHORITIES .. Al
PRELIMINARY STATEMENT
STATEMENT OF FACTS
ARGUMENT 17
POINT I: Plaintiff Has Set Forth Valid Causes of
Action in His First Amended Verified Complaint. 17
POINT II: Dr. Forman has Standing to Sue Under Public
Health Law §2805-j and k 18
POINT III: Plaintiff has Stated Causes of Action Sounding
in Negligence and Gross Negligence Against
Mercy .. 22
POINT IV: Plaintiff's Claims Sounding in Breach Of Implied
Contract and Breach of the Implied Covenant of
Good Faith and Fair Dealing Should Not Be
Dismissed 25
POINT V: Collateral Estoppel Does Not Bar Plaintiff's
Claims. 26
CONCLUSION 29
TABLE OF AUTHORITIES
Case Page(s)
9" St. Restaurant LLC v, Pen Quin Tenants Corp.,
2011 N.Y. Misc. LEXIS 6885, Sup. Ct. NY. County, 2011 29
Ackerman v. 305 East 4th Owners Corp.
189 A.D. 2d 662 (1* Dept 1993). 18
Ategra Credit Co. v. Chu,
29 AD3d 718 (2™ Dept 2006) 28
Batas v. Prudential Ins. Co. of America,
281 A.D.2d 260, 724 N.Y.S.2d 3, 2001 Slip Op. 02576 (1* Dept 2001) 21
Bokhour v. GTI Retail Holdings, Inc.,
94 A.D.3d 682, 941 N.Y.S. 20 675, (2™ Dept 2012) 28
Cantor v. Levine,
115 A.D, 2d 453, 495 N.Y.S. 2d 260, (2 Dept 1985)... 25
Carrier y. Salvation Army,
88 NY2d 298 (1996) 22
Cosmos Mason Supplies, Inc. v. Lido Beach Associates, Inc.
464 NYS. 2d 12 (2% Dept 1983)...cccccccccecsscscesesesesescssvevevsvessessesesseeenscsneaseeaeesees 25
CPP Int'l Inv. v. McKesson Corp.
120 AD2d 221 (1* Dept 1986) 22
Cunningham v. Newman,
2009 NY Misc. LEXIS 6516 * 5-6 [Sup. Ct. N.Y. Ct, 2009]
aff'd 81 AD 3d 440 (1 Dept 2011) 22
D’Arata v. New York Cent. Mut. Fire Ins. Co.,
76 NY2d 659 (1990)... 28
Dolphin Holdings Ltd. v. Gander & White Shipping Inc.,
122 A.D.3d 901, 998 N.Y.S.2d 107, (2™ Dept 2014) 24
Eliou & Scopelitis Steel Fabrication, Inc. v. Scottsdale, Ins. Co.,
2011 N.Y. Misc. LEXIS 2488 (Sup. Ct. NY County)..........cceeceeecsneeeeeeeeeeee
eee enee ene ee ene 24
Elmaliach v. Bank of China Ltd.
110 AD 3d 192, 171 NYS 2d 501 (1" Dept 2013).....ccccccccccscsssesssmmsecseessesesstscessneeeesees 24
AL
Falk y. Anesthesia Assoc.,
228 A.D. 2d 644 NYS 2d 237, (1* Dept 1996) 326 26
Foong y. Empire BlueCross BlueShield,
305 A.D. 2d 230, 762 N.Y.S. 2d 348, (1* Dept 2003) 21
Friedman v. Friedman,
141 A.D. 2d 401 (1" Dept1988).. 7
Giordano v. Victory Mem’l Hosp.,
273 A.D.2d 353, 711 N.Y.S.2d 730, (2™ Dept 2000) 26
Hudes v. Vytra Health Plans Long Island, Inc.,
187 Misc 2d 861 (Sup Ct Albany City 2001),
aff'd 295 AD2d 788 (3 Dept 2002)..........- 22
Jacobson v. McNeil Consumer & Specialty Pharm.,
68 AD3d 652, 654 (1st Dept 2009)
Kaufman y. Eli Lilly Co.,
65 N.Y. 2d 449, 497 NYS 2d, 584 (1985) 28
Laforte v. Staten Island University Hospital and Aiman Michael Abboud,
2003 N.Y. Misc. LEXIS 638 20
Leon v. Martinez,
84 N.Y. 2d 83 (1994) 17
Loomis v. Civetta Corinno Const. Corp.,
54 NY2d 18, 23 (1981)
Martino v. Morganii,
28 Misc. 3d 1212(A), 966 N.Y.S. 2d 347, Sup. Ct., Dutchess County, 2013 20
Matter of City of New York v. City Ciy. Serv. Commn.,
60 N.Y.2d 436, 442-443 (1983) 19
Pomerance v. McGrath,
2014 NY Misc. LEXIS 265 (Sup Ct NY Cty Jan. 23, 2014) 6,7
Rampart Brokerage Corp v. Ribs NY LLC,
2014 Misc. LEXIS 3047, Sup. Ct. N.Y. County.......00.0 eeeeer reer errr eee 24
Richbell Info Servs., Inc. v. Jupiter Partners, L.P.,
309 A.D. 2d 288, 289, 765 N.Y.S. 2d 575 (1" Dept 2003) 17
iii
Sapra v. Ten’s Cabaret, Ine.,
2010 N.Y. Misc. LEXIS 2662 (Sup. Ct., N.Y. County, 2002) 24
Scott v. Bell Atlantic Corp.,
282 A.D. 2d 180 (I* Dept 2001) 18
Signature Health Ctr, LLC v. State,
92 AD 3d 11, 14 (3 Dept 2001) Iv. denied 99 NY 3 811 (2012) 22
Society of Plastics Indus v. County of Suffolk
77 N.Y.2d 761, 769, 772 18
UB.A. Inc. v. New York City Taxi & Limousine Commission,
161 A.D. 2d 202 (1* Dept 1990) 18
Valle v. Popular Community Bank,
2014.N.Y. Misc. LEXIS 3684 26
Walden v. Nowinski,
63 AD2d 586 (1 Dept 1978)
Water St. Leasehold LLC v. Delotte & Touche, LLP
19 A.D. 3d 183, (1 Dept 2005) 24
Wiener v. Lazard Freres & Co.,
241 A.D. 2d 114 (1* Dept 1988) 17
Statutes
Public Health Law § 2805-j
Public Health Law § 2805-k
Iv
PRELIMINARY STATEMENT
Plaintiff, BERTON FORMAN, M.D. ("DR. FORMAN") respectfully submits this
memorandum of law in opposition to Defendants Mercy Medical Center and Catholic Health
Services of Long Island’s (the “Defendants”) pre-answer motion to dismiss Plaintiffs First
Amended Verified Complaint pursuant to CPLR § 3211(a)(1)(3)(5) and (7) and for sanctions.
Plaintiff also submits this memorandum in support of its cross-motion to amend the complaint
to the extent it is deemed necessary. Defendants’ motion should be denied in all respects.
Despite the representations on the part of the Defendants’ counsel during oral argument
which took place on January 7, 2015, Plaintiff still does not have his credentialing file. The fact
of the matter is that Dr, Forman’s file which comprises his more than twenty year history as an
attending physician at Defendant Mercy Medical Center (“Mercy”) no longer exists, and that
Defendants have inexplicably failed to reproduce it or make any effort to do so despite being
ordered by the Court to do so. Even worse is the fact that Defendants counsel made multiple
statements concerning Dr. Forman’s pre-litigation efforts to obtain his file which were
demonstrably untrue. It is undisputed that Mercy claims that Dr. Forman’s records were sent to
a storage facility where they were destroyed. He has the right to know why Defendants
concealed from him the shipment of his records and the circumstances concerning their
destruction. As a direct and proximate result of the Defendants’ actions Dr. Forman has been
unable to obtain employment as either a physician or a consultant. Moreover, given the
requirements of the Public Health Law discussed in greater detail below, the lack of a
credentialing file effectively precludes him from such employment in the future.
On multiple occasions Dr. Forman and his representatives demanded his records and his
1
demands have been unheeded. He thus has a right to be fully compensated for the damages he
sustained as the result of the destruction of his records. Defendants are seeking to shield
themselves from liability on the basis that Dr. Forman allegedly lacks standing to bring an action
against them pursuant to §2805-j and k of the Public Health Law. It is incontrovertible that
hospitals are required to maintain physician credentialing files pursuant to the statutory scheme
set forth in Public Health Law § 2805-j and k e¢ al. which is intended to among other things have
a beneficial effect in reducing malpractice awards and premiums for physicians. In all events,
record maintenance and preservation is of great significance in today’s climate of health care
reform. Dr. Forman as a physician, is thereby undoubtedly within the class of individuals who
are the intended beneficiaries of this statute. New York recognizes the importance of the
credentialing file as do other states and organizations and agencies such as the American Health
Information Management Association (“AHIMA”) (See e.g. Exhibit “K” annexed to the Kutner
Affirmation).
Defendants claim they gave Iron Mountain, a non-party storage facility Dr. Forman’s
only records of treatment for thousands of patients as well as reports and evaluations of Dr.
Forman’s treatment of said patients. Most importantly, the significance of Dr. Forman’s
credentialing records is that without them Dr. Forman is precluded from working in his chosen
profession. See e.g. N.Y. Public Health Law § 2805-k which mandates that a physician cannot
become affiliated with a hospital unless this information is provided. Clearly, Defendants had to
have been aware of the significance of what was contained in Dr. Forman’s credentialing file
when they decided to ship it off premises without telling him.'
Defendants’ contentions and attempts to whitewash everything are simplistic, smack of
bad faith and are contrary to common sense. They also attempt to minimize the fact that, at a time
when Dr. Forman was unaware that his credentialing file had been destroyed, let alone that it had
even been shipped from Mercy Medical Center, he had contacted multiple health care academic
institutions in New York, including but not limited to Stony Brook Medical Center, to see if there
were any available positions for an anesthesiologist. An example of Defendants bad faith is their
inclusion of an affidavit from Mr. Long, a Vice-President who claims that no request for Dr.
Forman’s files occurred from 2012 on. Dr. Forman, however, applied for jobs between 2010
when he first resigned from Mercy and 2012. In addition, Defendants’ contentions as to the
alleged failure on the part of Plaintiff to state a cause of action are insufficient to warrant
dismissal of Dr. Forman’s case against them by virtue of this pre-answer motion to dismiss.
While Defendants would no doubt prefer to simply make this case go away without having to
account in any way for what happened to Dr. Forman’s files it is clear that the instant motion is
premature and that discovery is warranted and that if necessary Plaintiff be offered the
opportunity to replead. More particularly, discovery is warranted in order to ascertain, among
other things, whether Mercy Medical Center was ever contacted by one of the academic
institutions, to which Dr. Forman applied, such as Stony Brook Medical Center in order to obtain
' Defendants have not disclosed whether Dr. Forman’s credentialing file was uniquely sent to an offsite facility and
also whether it was the only one, to use the hospital’s words, “inadvertently destroyed.” In other words they know
everything. Plaintiff on the other hand knows nothing. This is significant given the disagreement between Iron
Mountain and Mercy as to the circumstances concerning the destruction of the file. (See Transcript annexed to the
Kutner affirmation as Exhibit “A”, P.14).
Dr. Forman’s credentialing records.
It is fundamentally unfair for Defendants to criticize Plaintiff's allegations in his
Amended Verified Complaint as being insufficient without affording him the opportunity to
obtain discovery. Defendants know that the information pertaining to the transfer of Dr.
Forman’s files and the inadvertent destruction thereafter is solely within their knowledge. It is
also to be noted that nowhere in Defendants’ moving papers is there any refutation of the
underlying facts of this action as set forth in detail below. Nor is there any reference to how Dr.
Forman’s file was destroyed and why it was destroyed. Further, given the time frame when the
records were sent out and then destroyed and the particular circumstances, to wit., Dr. Forman
being a whistleblower Plaintiff in a case involving fraud in billing on the part of the hospitals,
Mercy’s story is inherently suspect. Indeed, Dr. Forman has good reason to believe that he was
disparately treated if it is confirmed that only his credentialing file was destroyed. As set forth in
the factual discussion below, Dr. Forman has alleged with good reason that the files were
destroyed for reasons unrelated to mere “inadvertence.” Given the misrepresentations that have
already been made, Defendants cannot simply be taken at their word. By way of example the
following misleading or incorrect statements on the part of Defendants include the following:
e Pg. 2 of its memorandum Defendants state that “Plaintiff claims his filed were lost
or destroyed.” This is incorrect as it is Defendants who make this claim which remains
unsubstantiated. Defendants fail to acknowledge the truth that Plaintiff has no way of verifying
what happened to his file. See e.g., affidavit of David Mandel annexed to the Kutner affirmation
as Exhibit “I”. He does know that he does not have it and has not been recreated.
* On Pgs. 3 and 5 of their memorandum Defendants discuss having provided
4
Plaintiff with two letters and a few miscellaneous patient encounters. Providing Plaintiff with
two letters following the disclosure of the non-existence of his credentialing file three years
after the fact is not tantamount to production of his credentialing file. Moreover, it does not even
remotely address, twenty-one years of service. This is a huge gap, one that cannot be explained
to a prospective employer. Also, in discussing the import of the Public Health Law Defendants
seek to impose the additional requirement that Dr. Forman had to establish a “specific purpose”
in otder to proceed with this information. There is, however, no authority for this proposition.
Further, Defendants inclusion of the Long affidavit undercuts their contentions as the Long
affidavit does not cover the period between the time of Dr. Forman’s resignation to the alleged
destruction of the file. In all events why is Plaintiff required to take the Defendants’ statements
at face value that the denial of his application “could not be premised on the unavailability of
his file.”
« On Pg. 6 of Defendants’ memorandum Defendants make reference to the Court’s
pointed observation about the viability of Plaintiff's claims. (P. 23 of Court transcript annexed
to the Kutner affirmation as Exhibit “A”.) It is to be noted (and it is detailed in the
accompanying Kutner affirmation) that the Court’s comments occurred after Defendants’
counsel had made multiple misstatements about the status of Dr. Forman’s credentialing file.
Plaintiffs have set forth valid causes of action against the Defendants sounding in gross
negligence, negligence, breach of implied contract, breach of the implied covenant of good faith
and fair dealing and for violations of two separate provisions the New York State Public Health
Law. As is more fully discussed below each of these causes of action should be sustained and
Defendants’ motion to dismiss should be denied in its entirety. There is also clearly nothing
5
frivolous or sanctionable here. In addition, Defendants attempts to miscast this case or Plaintiff's
damages as being barred by the doctrine of collateral estoppel are unjustified and inappropriate.
Finally, to the extent deemed necessary, by the Plaintiff should be given the opportunity to
amend the complaint in the form annexed to the Kutner affirmation since Defendants are moving
to dismiss this complaint and there is no prejudice.
DR. FORMAN SHOULD NOT HAVE TO MOVE FOR LEAVE TO AMEND
On January 7, 2015, the Court directed Plaintiff to file an amended complaint as Plaintiff
was permitted to do so as of right. Plaintiff thereupon filed its First Amended Verified Complaint
in the form annexed to the Kutner affirmation as Exhibit “B”. Defendants’ counsel, however, now
protests because the First Amended Verified Complaint differs in content from the one annexed to
Plaintiff's prior cross-motion. As set forth in the Kutner affirmation, however, Plaintiff's counsel
understood that he could amend the pleading as of right and thereupon the pleadings were
amended to delete Iron Mountain as a party, eliminate several causes of action, supplemented
several other claims and added one claim. More than a week after Defendants’ counsel was
served with both a redline and non-redline copy of the First Amended Verified Complaint he
executed a stipulation of discontinuance which was required by the clerk of the Court prior to
filing of the amended complaint. Defendants’ counsel did not object to the document at the time,
has moved to dismiss and in all events there has been no prejudice.
Defendants’ counsel also cites the case of Pomerance v. McGrath, 2014 NY Misc. Lexis
265, a case which involved multiple instances of filing without leave of the Court for the
proposition that Plaintiff now needs Court permission to file its First Amended Verified
6
Complaint even though Plaintiff has already moved to dismiss on other grounds. In citing
Pomerance v. McGrath, however, Defendants’ counsel neglects to mention that the Court in
Pomerance, Justice Jaffe, subsequently, actually granted the Plaintiff's cross-motion to replead
and denied the Defendants’ motion for sanctions, finding:
“Following submission of the instant motion, | granted plaintiff permission to
submit a revised complaint, and permitted the parties to submit new papers in light of it, advising
them that papers previously submitted on the motion would also be considered. Plaintiff thereafter
filed a proposed amended complaint dated February 19, 2014 (NYSCEF 190), now addressed.”
“A party is prejudiced within the meaning of CPLR 3025(b) when it “has been
hindered in the preparation of his case or has been prevented from taking some measure in
support of his position.” (Loomis v. Civetta Corinno Const. Corp.. 54 NY2d 18, 23 [1981}).
“That a defendant will be compelled to expend additional resources in preparing its
case or that it now faces greater liability as a result of the amendment does not constitute
prejudice.” (Jacobson v. McNeil Consumer & Specialty Pharm. 68 AD3d 652, 654 [1* Dept
2009)).
Here Plaintiff received permission to amend as of right and Defendants have sustained no
prejudice. Defendants also cite Walden v. Nowinksi, 63 AD2d 586, 1" Dept 1978, as authority for
the proposition that Plaintiff needs to move for permission to replead without mentioning that in
said case the Court granted Plaintiff leave to renew the cross-motion on submission of proper
papers.
In all events Plaintiff has not acted in a frivolous matter. Instead, he voluntarily
discontinued the action against Iron Mountain, withdrew several causes of action, added one
cause of action and supplemented some allegations.
STATEMENT OF FACTS
This action involves the wrongful actions on the part of Defendants MERCY MEDICAL
CENTER, CATHOLIC HEALTH SERVICES OF LONG ISLAND (hereinafier “Mercy,”
7
“Catholic Health Services” or “Defendants”) in failing to maintain Plaintiffs physician
credentialing file for the more than two decade period while he served as an anesthesiologist on
the medical staff at Mercy and in intentionally and/or negligently destroying such records or
permitting, directing or acting in concert with a non-party, IRON MOUNTAIN INC. (“IRON
MOUNTAIN”) to destroy said records and in failing to timely apprise Plaintiff that his records
had been destroyed.
Plaintiff seeks to recover damages occasioned by Defendants’ gross negligence and
ordinary negligence, recklessness and intentional acts, by which Defendants directly or
intentionally caused the destruction of Plaintiff's credentialing file which represented his entire
twenty-one year professional care at Mercy Hospital. In destroying, authorizing or permitting the
destruction of such records Defendants acted in a willful and reckless disregard of Plaintiff's
rights and violated the Public Health Law as well as its own bylaws and risk management rules.
Most importantly, because of the destruction of his records Dr. Forman has been effectively
precluded from ever again working as an anesthesiologist for a hospital causing his career to
come to a dead halt. Furthermore, Dr. Forman had no way of knowing his records no longer
existed when he was seeking employment from multiple health care institutions or when he
sought consulting work.
According to the affidavits and correspondence provided by Defendant Mercy in response
to a subpoena to produce Dr. Forman’s records in another lawsuit, the destruction of Plaintiff's
credentialing file in August of 2012 during the time when Defendants Mercy and Catholic Health
Services were aware that Plaintiff was a “Relator” in a “whistleblower” qui tam case involving
anesthesia health care fraud billing against an unrelated, nonparty hospital group. The destruction
of Dr. Forman’s credentialing file conceivably prevented disclosure of documents that may have
8
supported similar claims against Defendants had Dr. Forman’s records become public. To protect
its interests, Defendants intentionally destroyed or enlisted non-party Iron Mountain to act in
concert with them to destroy Dr. Forman’s records on Mercy’s behalf and to protect itself from
liability both financially and to its reputation.
Among other things, during said period of time, Edward Siems, Director of Anesthesia at
Mercy called Plaintiff each time an article appeared about Plaintiff's involvement with the gui
fam case and another case brought against an insurance company. Dr. Siems wanted to know if
Plaintiff had ever mentioned Mercy during the course of those cases. Also, Plaintiff as early as
2009 had informed Mercy’s Medical Director John Reilly of the 370 double billing issue.
Undoubtedly, motivation existed on the part of Defendants to destroy Dr. Forman’s files.
Defendants’ submissions in connection with this motion offer nothing to refute the factual
allegations set forth in Dr. Forman’s First Amended Verified Complaint, a copy of which is
annexed to the Kutner affirmation as Exhibit “B”.
Defendants” actions have unquestionably caused irreparable harm to Dr. Forman’s
professional reputation and career. The Defendants’ actions were arbitrary, groundless, negligent,
grossly negligent and irresponsible and in breach of their contractual, statutory, fiduciary and
moral obligations owed. Dr. Forman has also alleged that Defendants and Iron Mountain’s
actions were also part of a larger pattern of fraud and neglect and breach of duty.
THE PARTIES
Dr. Forman
Plaintiff, Berton Forman, M.D. is an anesthesiologist who has been licensed to practice
medicine by the State of New York for more than thirty years. Dr. Forman is also a recognized
9
expert in ascertaining the existence of medical fraud and has a particular expertise in identifying
over billing on the part of physicians and other health care providers and in particular the auditing
of the claims and records of hospitals and has a proven record in identifying and assisting in the
recovery of funds fraudulently or otherwise improperly paid to such physicians who are engaged
in the practice of anesthesiology. Since November 30, 2004 Dr. Forman has been the owner of a
United States Patent for Health Care Fraud Software Systems, Patent # 6,826,356b1, for a
healthcare monitor system for detecting healthcare fraud. The patent has twelve different claims
accepted as being unique and patentable by the United States Patent and Trademark Office.
Dr. Forman was also a whistleblower or “relator” having successfully brought an action
pursuant to the Whistleblower Protection Act of 1982 as amended, against an unrelated nonparty
hospital group. Said action resulted in the hospital group agreeing to greater transparency when
billing their anesthesia revenue codes. Whistleblowers are awarded federal protection under the
Whistleblower Protection Act of 1989, as amended, and may file complaints that they believe
reasonably evidence a violation of law, rule or regulation, gross mismanagement, gross waste of,
funds, an abuse of authority, or a substantial and specific danger to public health or safety.
Defendants
Defendant Mercy Medical Center is a hospital and is part of the Defendant Catholic
Health Services System. Mercy is located in Rockville Centre, New York. According to its
website Mercy is a 375 bed hospital facility, with more than 700 physicians, and a staff of 1,100.
Defendant Catholic Health Services of Long Island is the largest faith-based health care
system on Long Island and is comprised of six hospitals and various health and human services
agencies. Catholic Health Services of Long Island proclaims as its mission that it affirms the
10
sanctity of life, advocates for the poor and underserved, and serves the common good. It also
proclaims that it conducts its healthcare practice, business, education and innovation with justice,
integrity and respect for the dignity of each person.
ADDITIONAL BACKGROUND
Defendants’ actions directly or indirectly caused the wholesale destruction of Dr.
Forman’s quality care and credentialing records for the entire twenty-one year period during
which he provided anesthesia services as an attending physician to Mercy. During such period,
from 1989 until February 2010 Dr. Forman handled as many as fifteen thousand (15,000) cases.
Thus Dr. Forman’s more than two decade history of care and treatment of patients has been
completely eradicated. As an anesthesiologist Dr. Forman’s services are necessarily hospital
based and thus for all intents and purposes require him to have a hospital affiliation. Further, as
discussed below Public Health Law Sec. 2805-j and k mandate, among other things, that the
hospital must preserve Dr. Forman’s credentialing file and also that before Dr. Forman or any
other physician can be accredited to work in a hospital he must first produce the records from his
prior hospital affiliations. The failure to produce such records, particularly when the physician
has only worked in one place for the past two decades gives rise to an inference that Dr. Forman,
an anesthesiologist did something wrong. And it is not difficult to imagine what someone might
think about an anesthesiologist, who did something wrong. And while the defendants attempt to
minimize and misstate the impact this destruction had has on Dr. Forman’s career by falsely
stating that is purported inability to demonstrate damages in his legal malpractice case precludes
him from recovering here fact of the matter is the destruction of Dr. Forman’s quality care and
11
credentialing file therefore precludes him from affiliating with another hospital to practice his
chosen profession and specialty. Moreover, Dr. Forman has confirmed he made efforts to obtain
an education based affiliation at a time when he was unaware of the destruction of his
credentialing file. This is also confirmed by among other things the Public Health Law and by
Mercy’s own bylaws. See e.g. Article V of the bylaws, Procedure for Appointment and
Reappointment requiring extensive information concerning applications for employment. Also,
section 1(b):
“The applicant shall have the burden of producing adequate information for proper
evaluation of his/her current competence, current license, relevant training or
experiences, Board status and health status as it relates to the ability to perform the
privileges requested, character, ethics, and qualifications for resolving any doubts
about such qualifications.” (See Exhibit “H” to the Kutner Affirmation).
Mercy’s own bylaws confirm that they would not have hired Dr. Forman had he now
sought employment with them. If Mercy would not hire someone without a credentialing file why
would they expect anyone else to. Therefore Defendants should not be permitted to exculpate
themselves from liability as they were responsible for and had a non-delegable duty to Dr.
Forman pursuant to the New York State Public Health Law to make sure his files were properly
maintained and not destroyed.
Dr. Forman did not become aware of the destruction of his records in January 2013 nearly
three years after he left Mercy. From 2010 to January 2013, Mercy concealed from Dr. Forman
the fact that his records were transferred. Ultimately, they only divulged the truth when they were
legally compelled to respond to a subpoena in an unrelated legal malpractice proceeding. This is
confirmed by the affidavit of David Mandel, annexed to the Kutner Affirmation as Exhibit “I’”)
which provides:
12
That on February 4, 2010 Dr. Forman resigned from the Medical Staff at Mercy
Medical Center.
That on March 31, 2010, Dr. Forman’s credentialing and Quality file were
received by an offsite storage facility.
That on August 24, 2012 there was an inadvertent destruction of Dr. Berton
Forman’s credential and quality file at the offsite storage facility.
That on December 18, 2012 I became aware that the credential and quality files of
Dr. Berton Forman had been destroyed via secured shredding.
The foregoing confirms that as of January 8, 2013, nearly three years after Dr. Forman
resigned from Mercy Medical Center, and after Dr. Forman had been seeking employment having
no knowledge that his records were missing Mercy Medical Center inexplicably revealed for the
first time that Dr. Forman’s records not only were shipped to someone else but also that they did
not exist and were allegedly destroyed by the non-party Iron Mountain. None of the
circumstances as to their destruction have ever been made known to Plaintiff which begs the
question whether only Plaintiffs records were involved. By their affidavits, Defendants admitted
that Dr. Forman’s records, the entire written history of his twenty one year history of successfully
and professionally rendering medical services at Mercy Medical Center had been destroyed. Also
see letter dated February 25, 2013, a copy of which is annexed to the Kutner Affirmation as
Exhibit “J, from Brice Beach, at attorney at Defendant Mercy to Dr. Forman’s then attorney
which stated in pertinent part:
... “In January 2013 Risk Management at the Hospital was served with a subpoena
Duces Tecum requesting Dr. Forman’s files. Risk Management, as well as David
Mandel, sent an affidavit to the Court stating that the requested files do not exist as
they were inadvertently destroyed by Iron Mountain, an offsite third-party vendor
13
who stores files for the Hospital.”
Mr. Mandel’s affidavit is more instructive for what it does not say as opposed to for what
it says in that it confirms that Dr. Forman, who resigned from the medical staff at Mercy Medical
Center on February 4, 2010 was not even told that his credentialing and quality care file were sent
to Defendant Iron Mountain, an offsite storage facility. Presumably, Mercy was aware, by virtue
of its own bylaws as well as other statutory and regulatory requirements, that Dr. Forman or any
prospective institution including hospitals that Dr. Forman would seek to become affiliated with
would have reason and need to access these and other Public Health law mandated materials at
some future date for either personal or professional reasons. In all events, it seems more than
coincidental that Dr. Forman’s credential and quality file were allegedly “inadvertently
destroyed” on August 24, 2012, more than two and a half years after he resigned from Mercy and
while the gui ‘am case which involved fraudulent revenue code 370 over billings by hospitals,
was going full steam. Noteworthy is the fact that the whistleblower case brought by Dr. Forman
shined a spotlight on the world of hospital billing practices with national implications, something
that the Defendants were not pleased with.
Also during the time period noted above, Dr. Forman successfully resolved an action he
brought against an insurance company which had retained him to locate fraud in medical bills. As
a consequence of his engagement by this insurance company Dr. Forman uncovered tens of
millions of dollars in fraudulent overbilling on the part of hospitals throughout the United States.
MERCY AND CATHOLIC HEALTH SERVICES
WERE REQUIRED TO MAINTAIN DR. FORMAN’S CREDENTIALING FILE
Pursuant to §2805-j et seq. of the New York Public Health Law all hospitals in the State
14
of New York are required to create and maintain reports as part of the Hospital’s Quality
Assurance Program.
Included within the reports that hospitals are required to maintain are the individual
credentialing files for physicians. The credentialing files of all attending physicians are created,
maintained and utilized for among other reasons the purpose of evaluating physicians who are
members of the Hospital’s staff as required by the Public Health Law. NY Public Health Law
§2805-j provides in relevant part as follows:
I Every hospital shall maintain a coordinated program for the identification and
prevention of medical, dental and podiatric malpractice. Such program shall include:
a) The establishment of a quality assurance committee with the responsibility to
review the services rendered in the hospital in order to improve the quality of
medical, dental and podiatric care of patients and to prevent medical, dental and
podiatric malpractice. Such committee shall oversee and coordinate the medical,
dental and podiatric malpractice prevention program and shall insure that
information gathered pursuant to the program is utilized to review and to revise
hospital policies and procedures...
b) A medical, dental and podiatric staff privileges sanction procedure through which
credentials, physical and mental capacity and competence in delivering health care
services are periodically reviewed, and reviewed as otherwise warranted in
specific instances and circumstances, as part of an evaluation of staff privileges;
e) The periodic review and the review as otherwise warranted in specific instances
and circumstances of the credentials, physical and mental capacity and competence
in delivering health care services of all persons who are employed or associated
with the hospital;
4) A procedure for the prompt resolution of grievances by patients or their
representatives related to accidents, injuries, treatment and other events that may
result in claims of medical, dental or podiatric malpractice;
e} The maintenance and continuous collection of information concerning the
hospital’s experience with negative health care outcomes and incidents injurious to
patients, patient grievances, professional liability premiums, settlements, awards,
costs incurred by the hospital for patient injury prevention and safety improvement
activities;
The maintenance of relevant and appropriate information gathered pursuant _to
paragraphs (a) through (e) of this section concerning individual physicians dentists
and_podiatrist_within the physician’s, dentist’s or _podiatrist’s personnel_or
credential file maintained by the hospital. (emphasis added).
15
Dr. Forman cannot obtain employment as a physician with a hospital or facility approved
by Article 28 of the Public Health Law unless he can provide such entity with the materials from
his credentialing file. See Public Health Law § 2805-k (Investigations prior to granting or
renewing privileges) which provides:
1. Prior to granting or renewing professional privileges or association of any
physician, dentist or podiatrist or hiring a physician, dentist or podiatrist, a hospital
or facility approved pursuant to this article shall request from the physician, dentist
or podiatrist and the physician, dentist or podiatrist shall be required to provide the
following information:
(a) The name of any hospital or facility with or at which the physician, dentist or
podiatrist had or has any association, employment, privileges or practice;
(b) Where such association, employment, privilege or practice was discontinued, the
reasons for its discontinuation;
(c) Any pending professional medical, dental or podiatric misconduct proceedings or any
pending medical malpractice actions in this state or another state, the substance of the
allegations in such proceedings or actions, and any additional information concerning
such proceedings or actions as the physician, dentist or podiatrist may deem appropriate;
(d) The substance of the findings in such actions or proceedings and any additional
information concerning such actions or proceedings as the physician, dentist or podiatrist
may deem appropriate;
{e) A waiver by the physician, dentist or podiatrist of any confidentiality provisions
concerning the information required to be provided to hospitals pursuant to this
subdivision; and
(f) Documentation that the physician, dentist or podiatrist has completed the course work
or training as mandated by section two hundred [fig 1] thirty-nine of this chapter or
section six thousand five hundred five-b of the education law. A hospital or facility shall
not grant or renew professional privileges or association to a physician, dentist, or
podiatrist who has not completed such course work or training.
(g) A verification by the physician, dentist or podiatrist that the information provided by
the physician, dentist or podiatrist is true and accurate.
2. Prior to granting privileges or association to any physician, dentist or podiatrist, or
hiring a physician, dentist or podiatrist, any hospital or facility approved pursuant to this
article shall request from any hospital with or at which such physician, dentist or
podiatrist had or has privileges, was associated, or was employed, the following
information concerning such physician, dentist or podiatrist:
16
(a) Any pending professional medical conduct proceedings or any pending medical
malpractice actions, in this state or another state;
(b) Any judgment or settlement of a medical malpractice action and any finding of
professional Misconduct in this state or another; and
(c) Any information required to be reported by hospitals pursuant to section twenty-eight
hundred three-e of this article.
Finally, Mercy’s own bylaws, relevant excerpts of which are annexed to the Kutner
affirmation and are cited therein provide that all applications for medical staff shall require
detailed information concerning the applicants professional qualifications including “adequate
information for proper evaluation of his/her competence, current licensure, relevant training,
Board status and health status.”
ARGUMENT
POINT I
PLAINTIFF HAS SET FORTH VALID CAUSES OF
ACTION IN HIS FIRST AMENDED VERIFIED COMPLAINT
Each of Dr. Forman’s causes of action asserted against Defendants are sustainable as a
matter of law. The Court of Appeals has held that on a CPLR 3211(a)(7) motion to dismiss, the
pleading is to be afforded a liberal construction accepting all alleged facts as true and giving
Plaintiff the benefit of every possible favorable inference to determine only whether the facts
as alleged fit any cognizable legal theory. Leon v. Martinez, 84 N.Y. 2d 83 (1994). "The
criterion is whether the proponent of a pleading has a cause of action, not whether he has stated
one." Id. At 88. See also, Wiener v. Lazard Freres & Co., 241 A.D. 2d 114 (1" Dept 1988),
and Friedman v. Friedman, 141 A.D. 2d 401 (1" Dept 1988). The motion must be denied, if
from the pleadings four comers, "factual allegations are discerned which taken together manifest
any cause of action cognizable at law." (Richbeil Info Servs., Inc. v. Jupiter Partners, L.P., 309
17
A.D. 2d 288, 289, 765 N.Y.S. 2d 575 [1 Dept 2003]). See also, UB.A. Inc. v. New York City
Taxi & Limousine Commission, 161 A.D. 2d 202 (1* Dept 1990), Scott v. Bell Atlantic Corp.,
282 A.D. 2d 180 (1" Dept 2001). Where such factual allegations exist, the motion should be
denied. Ackerman y. 305 East 4dh Owners Corp. 189 A.D. 2d 662 (1* Dept 1993). As set
forth herein applying this standard, each of Plaintiff's causes of action asserted against
Defendants are sufficient and should not be dismissed.
POINT II
DR. FORMAN HAS STANDING TO SUE UNDER
PUBLIC HEALTH LAW §2805-j AND k
Defendants disingenuously argue that Dr. Forman lacks standing to sue under Public
Health Law § 2805-j and k which they contend does not confer upon him a private right of action.
More specifically, they contend that Dr. Forman is not entitled to sue for money damages as a
result of Mercy’s non-compliance with the statute. Defendants’ analysis is flawed, however, for
several reasons. First, Defendants’ would offer no remedy for violating the law. In essence,
Defendants’ contention is that there should be no consequences for a violation of the statute even
though, as discussed below, one of its purposes was to offer protection to physicians. Such an
interpretation would no doubt be anathema to the stated purpose behind Section 2805-j and k in
the first place. Since Dr. Forman is undoubtedly a member of the class of persons for whom the
statute was designed to protect, however, Defendants’ argument is clearly erroneous under
applicable law.
On the question of standing, the courts of New York have noted that this is a threshold
issue and a litigant must establish standing in order to seek judicial review (see Society of Plastics
Indus v. County of Suffolk 77 N.Y.2d 761, 769, 772). The burden of establishing standing is on
18
the party seeking review (id.). An individual’s standing hinges on the following criteria: (1) the
harm asserted must be arguably within the zone of interest to be protected by the statutory or
constitutional provisions sought to be enforced; (2) the decision for which review is sought must
be shown to have a harmful effect upon the party asserting standing; and (3) there must be no
clear legislative intent negating review (see, Matter of City of New York v. City Ciy. Serv.
Common., 60 N.Y.2d 436, 442-443 (1983), citing Matter of Dairylea Coop. v. Walkley, 38
N.Y.2d 6, 8-11, and Matter of Bradford Cent. School Dist. v. Ambach, 56 N.Y.2d 158, 163-164.
Article 28 of the Public Health Law is replete with references to its legislative purpose, i.e.
for the protection of both consumers of health care as well as physicians. See e.g. Legislative
Findings and declaration. L. 1985 ¢. 294, §1, eff July 1, 2985, “The 1985 Medical Malpractice
Reform Act”:
“The legislature hereby finds and declares that a comprehensive reform of the medical and
dental malpractice adjudication system is necessary in order to ensure the continued
availability and affordability of quality health care services in New York State. Escalating
malpractice insurance premiums discourage physicians and dentists from initiating or
continuing their practice in New York and contribute to the rising cost of health care as
premium costs are passed along to the health care consumer... By expediting case
resolution, discouraging frivolous claims and defenses, moderating attorney contingency
fees, limiting the opportunity for double recoveries and requiring the periodic payment of
large future awards, the Legislature intends to reduce the escalating cost of malpractice
insurance and to improve the adjudication of malpractice claims. The legislature further
finds that hospitals must enhance their efforts to reduce medical and dental malpractice
through the establishment of medical and dental malpractice prevention programs and
through greater scrutiny of physicians and dentists prior to granting hospital privileges and
that increased scrutiny of hospital privileges and that increased resources should be
devoted to the investigation and prosecution of p
Preview
YORK OUN Kk 04 Dv INDEX NO. 156138/2014 NYSCEF BOC. NO. 107 RECEIVED NYSCEF 03/30/2015 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK. eee ee eens BERTON FORMAN, M.D. Index No. 156138/2014 Plaintiffs, -against- MERCY MEDICAL CENTER and CATHOLIC HEALTH SERVICES OF LONG ISLAND Defendants. ree een eee nee ene ene nen een neem ene ene n een emen nen eneeneeene, PLAINTIFF’S MEMORANDUM OF LAW IN OPPOSITION TO DEFENDANT MERCY MEDICAL CENTER’S MOTION TO DISMISS AND FOR OTHER RELIEF AND IN SUPPORT OF CROSS-MOTION Law Offices of Kenneth L. Kutner Attorney for Plaintiff Berton Forman, M.D. 1185 Avenue of the Americas New York, NY 10036 (212) 684-0088 TABLE OF CONTENTS TABLE OF AUTHORITIES .. Al PRELIMINARY STATEMENT STATEMENT OF FACTS ARGUMENT 17 POINT I: Plaintiff Has Set Forth Valid Causes of Action in His First Amended Verified Complaint. 17 POINT II: Dr. Forman has Standing to Sue Under Public Health Law §2805-j and k 18 POINT III: Plaintiff has Stated Causes of Action Sounding in Negligence and Gross Negligence Against Mercy .. 22 POINT IV: Plaintiff's Claims Sounding in Breach Of Implied Contract and Breach of the Implied Covenant of Good Faith and Fair Dealing Should Not Be Dismissed 25 POINT V: Collateral Estoppel Does Not Bar Plaintiff's Claims. 26 CONCLUSION 29 TABLE OF AUTHORITIES Case Page(s) 9" St. Restaurant LLC v, Pen Quin Tenants Corp., 2011 N.Y. Misc. LEXIS 6885, Sup. Ct. NY. County, 2011 29 Ackerman v. 305 East 4th Owners Corp. 189 A.D. 2d 662 (1* Dept 1993). 18 Ategra Credit Co. v. Chu, 29 AD3d 718 (2™ Dept 2006) 28 Batas v. Prudential Ins. Co. of America, 281 A.D.2d 260, 724 N.Y.S.2d 3, 2001 Slip Op. 02576 (1* Dept 2001) 21 Bokhour v. GTI Retail Holdings, Inc., 94 A.D.3d 682, 941 N.Y.S. 20 675, (2™ Dept 2012) 28 Cantor v. Levine, 115 A.D, 2d 453, 495 N.Y.S. 2d 260, (2 Dept 1985)... 25 Carrier y. Salvation Army, 88 NY2d 298 (1996) 22 Cosmos Mason Supplies, Inc. v. Lido Beach Associates, Inc. 464 NYS. 2d 12 (2% Dept 1983)...cccccccccecsscscesesesesescssvevevsvessessesesseeenscsneaseeaeesees 25 CPP Int'l Inv. v. McKesson Corp. 120 AD2d 221 (1* Dept 1986) 22 Cunningham v. Newman, 2009 NY Misc. LEXIS 6516 * 5-6 [Sup. Ct. N.Y. Ct, 2009] aff'd 81 AD 3d 440 (1 Dept 2011) 22 D’Arata v. New York Cent. Mut. Fire Ins. Co., 76 NY2d 659 (1990)... 28 Dolphin Holdings Ltd. v. Gander & White Shipping Inc., 122 A.D.3d 901, 998 N.Y.S.2d 107, (2™ Dept 2014) 24 Eliou & Scopelitis Steel Fabrication, Inc. v. Scottsdale, Ins. Co., 2011 N.Y. Misc. LEXIS 2488 (Sup. Ct. NY County)..........cceeceeecsneeeeeeeeeeee eee enee ene ee ene 24 Elmaliach v. Bank of China Ltd. 110 AD 3d 192, 171 NYS 2d 501 (1" Dept 2013).....ccccccccccscsssesssmmsecseessesesstscessneeeesees 24 AL Falk y. Anesthesia Assoc., 228 A.D. 2d 644 NYS 2d 237, (1* Dept 1996) 326 26 Foong y. Empire BlueCross BlueShield, 305 A.D. 2d 230, 762 N.Y.S. 2d 348, (1* Dept 2003) 21 Friedman v. Friedman, 141 A.D. 2d 401 (1" Dept1988).. 7 Giordano v. Victory Mem’l Hosp., 273 A.D.2d 353, 711 N.Y.S.2d 730, (2™ Dept 2000) 26 Hudes v. Vytra Health Plans Long Island, Inc., 187 Misc 2d 861 (Sup Ct Albany City 2001), aff'd 295 AD2d 788 (3 Dept 2002)..........- 22 Jacobson v. McNeil Consumer & Specialty Pharm., 68 AD3d 652, 654 (1st Dept 2009) Kaufman y. Eli Lilly Co., 65 N.Y. 2d 449, 497 NYS 2d, 584 (1985) 28 Laforte v. Staten Island University Hospital and Aiman Michael Abboud, 2003 N.Y. Misc. LEXIS 638 20 Leon v. Martinez, 84 N.Y. 2d 83 (1994) 17 Loomis v. Civetta Corinno Const. Corp., 54 NY2d 18, 23 (1981) Martino v. Morganii, 28 Misc. 3d 1212(A), 966 N.Y.S. 2d 347, Sup. Ct., Dutchess County, 2013 20 Matter of City of New York v. City Ciy. Serv. Commn., 60 N.Y.2d 436, 442-443 (1983) 19 Pomerance v. McGrath, 2014 NY Misc. LEXIS 265 (Sup Ct NY Cty Jan. 23, 2014) 6,7 Rampart Brokerage Corp v. Ribs NY LLC, 2014 Misc. LEXIS 3047, Sup. Ct. N.Y. County.......00.0 eeeeer reer errr eee 24 Richbell Info Servs., Inc. v. Jupiter Partners, L.P., 309 A.D. 2d 288, 289, 765 N.Y.S. 2d 575 (1" Dept 2003) 17 iii Sapra v. Ten’s Cabaret, Ine., 2010 N.Y. Misc. LEXIS 2662 (Sup. Ct., N.Y. County, 2002) 24 Scott v. Bell Atlantic Corp., 282 A.D. 2d 180 (I* Dept 2001) 18 Signature Health Ctr, LLC v. State, 92 AD 3d 11, 14 (3 Dept 2001) Iv. denied 99 NY 3 811 (2012) 22 Society of Plastics Indus v. County of Suffolk 77 N.Y.2d 761, 769, 772 18 UB.A. Inc. v. New York City Taxi & Limousine Commission, 161 A.D. 2d 202 (1* Dept 1990) 18 Valle v. Popular Community Bank, 2014.N.Y. Misc. LEXIS 3684 26 Walden v. Nowinski, 63 AD2d 586 (1 Dept 1978) Water St. Leasehold LLC v. Delotte & Touche, LLP 19 A.D. 3d 183, (1 Dept 2005) 24 Wiener v. Lazard Freres & Co., 241 A.D. 2d 114 (1* Dept 1988) 17 Statutes Public Health Law § 2805-j Public Health Law § 2805-k Iv PRELIMINARY STATEMENT Plaintiff, BERTON FORMAN, M.D. ("DR. FORMAN") respectfully submits this memorandum of law in opposition to Defendants Mercy Medical Center and Catholic Health Services of Long Island’s (the “Defendants”) pre-answer motion to dismiss Plaintiffs First Amended Verified Complaint pursuant to CPLR § 3211(a)(1)(3)(5) and (7) and for sanctions. Plaintiff also submits this memorandum in support of its cross-motion to amend the complaint to the extent it is deemed necessary. Defendants’ motion should be denied in all respects. Despite the representations on the part of the Defendants’ counsel during oral argument which took place on January 7, 2015, Plaintiff still does not have his credentialing file. The fact of the matter is that Dr, Forman’s file which comprises his more than twenty year history as an attending physician at Defendant Mercy Medical Center (“Mercy”) no longer exists, and that Defendants have inexplicably failed to reproduce it or make any effort to do so despite being ordered by the Court to do so. Even worse is the fact that Defendants counsel made multiple statements concerning Dr. Forman’s pre-litigation efforts to obtain his file which were demonstrably untrue. It is undisputed that Mercy claims that Dr. Forman’s records were sent to a storage facility where they were destroyed. He has the right to know why Defendants concealed from him the shipment of his records and the circumstances concerning their destruction. As a direct and proximate result of the Defendants’ actions Dr. Forman has been unable to obtain employment as either a physician or a consultant. Moreover, given the requirements of the Public Health Law discussed in greater detail below, the lack of a credentialing file effectively precludes him from such employment in the future. On multiple occasions Dr. Forman and his representatives demanded his records and his 1 demands have been unheeded. He thus has a right to be fully compensated for the damages he sustained as the result of the destruction of his records. Defendants are seeking to shield themselves from liability on the basis that Dr. Forman allegedly lacks standing to bring an action against them pursuant to §2805-j and k of the Public Health Law. It is incontrovertible that hospitals are required to maintain physician credentialing files pursuant to the statutory scheme set forth in Public Health Law § 2805-j and k e¢ al. which is intended to among other things have a beneficial effect in reducing malpractice awards and premiums for physicians. In all events, record maintenance and preservation is of great significance in today’s climate of health care reform. Dr. Forman as a physician, is thereby undoubtedly within the class of individuals who are the intended beneficiaries of this statute. New York recognizes the importance of the credentialing file as do other states and organizations and agencies such as the American Health Information Management Association (“AHIMA”) (See e.g. Exhibit “K” annexed to the Kutner Affirmation). Defendants claim they gave Iron Mountain, a non-party storage facility Dr. Forman’s only records of treatment for thousands of patients as well as reports and evaluations of Dr. Forman’s treatment of said patients. Most importantly, the significance of Dr. Forman’s credentialing records is that without them Dr. Forman is precluded from working in his chosen profession. See e.g. N.Y. Public Health Law § 2805-k which mandates that a physician cannot become affiliated with a hospital unless this information is provided. Clearly, Defendants had to have been aware of the significance of what was contained in Dr. Forman’s credentialing file when they decided to ship it off premises without telling him.' Defendants’ contentions and attempts to whitewash everything are simplistic, smack of bad faith and are contrary to common sense. They also attempt to minimize the fact that, at a time when Dr. Forman was unaware that his credentialing file had been destroyed, let alone that it had even been shipped from Mercy Medical Center, he had contacted multiple health care academic institutions in New York, including but not limited to Stony Brook Medical Center, to see if there were any available positions for an anesthesiologist. An example of Defendants bad faith is their inclusion of an affidavit from Mr. Long, a Vice-President who claims that no request for Dr. Forman’s files occurred from 2012 on. Dr. Forman, however, applied for jobs between 2010 when he first resigned from Mercy and 2012. In addition, Defendants’ contentions as to the alleged failure on the part of Plaintiff to state a cause of action are insufficient to warrant dismissal of Dr. Forman’s case against them by virtue of this pre-answer motion to dismiss. While Defendants would no doubt prefer to simply make this case go away without having to account in any way for what happened to Dr. Forman’s files it is clear that the instant motion is premature and that discovery is warranted and that if necessary Plaintiff be offered the opportunity to replead. More particularly, discovery is warranted in order to ascertain, among other things, whether Mercy Medical Center was ever contacted by one of the academic institutions, to which Dr. Forman applied, such as Stony Brook Medical Center in order to obtain ' Defendants have not disclosed whether Dr. Forman’s credentialing file was uniquely sent to an offsite facility and also whether it was the only one, to use the hospital’s words, “inadvertently destroyed.” In other words they know everything. Plaintiff on the other hand knows nothing. This is significant given the disagreement between Iron Mountain and Mercy as to the circumstances concerning the destruction of the file. (See Transcript annexed to the Kutner affirmation as Exhibit “A”, P.14). Dr. Forman’s credentialing records. It is fundamentally unfair for Defendants to criticize Plaintiff's allegations in his Amended Verified Complaint as being insufficient without affording him the opportunity to obtain discovery. Defendants know that the information pertaining to the transfer of Dr. Forman’s files and the inadvertent destruction thereafter is solely within their knowledge. It is also to be noted that nowhere in Defendants’ moving papers is there any refutation of the underlying facts of this action as set forth in detail below. Nor is there any reference to how Dr. Forman’s file was destroyed and why it was destroyed. Further, given the time frame when the records were sent out and then destroyed and the particular circumstances, to wit., Dr. Forman being a whistleblower Plaintiff in a case involving fraud in billing on the part of the hospitals, Mercy’s story is inherently suspect. Indeed, Dr. Forman has good reason to believe that he was disparately treated if it is confirmed that only his credentialing file was destroyed. As set forth in the factual discussion below, Dr. Forman has alleged with good reason that the files were destroyed for reasons unrelated to mere “inadvertence.” Given the misrepresentations that have already been made, Defendants cannot simply be taken at their word. By way of example the following misleading or incorrect statements on the part of Defendants include the following: e Pg. 2 of its memorandum Defendants state that “Plaintiff claims his filed were lost or destroyed.” This is incorrect as it is Defendants who make this claim which remains unsubstantiated. Defendants fail to acknowledge the truth that Plaintiff has no way of verifying what happened to his file. See e.g., affidavit of David Mandel annexed to the Kutner affirmation as Exhibit “I”. He does know that he does not have it and has not been recreated. * On Pgs. 3 and 5 of their memorandum Defendants discuss having provided 4 Plaintiff with two letters and a few miscellaneous patient encounters. Providing Plaintiff with two letters following the disclosure of the non-existence of his credentialing file three years after the fact is not tantamount to production of his credentialing file. Moreover, it does not even remotely address, twenty-one years of service. This is a huge gap, one that cannot be explained to a prospective employer. Also, in discussing the import of the Public Health Law Defendants seek to impose the additional requirement that Dr. Forman had to establish a “specific purpose” in otder to proceed with this information. There is, however, no authority for this proposition. Further, Defendants inclusion of the Long affidavit undercuts their contentions as the Long affidavit does not cover the period between the time of Dr. Forman’s resignation to the alleged destruction of the file. In all events why is Plaintiff required to take the Defendants’ statements at face value that the denial of his application “could not be premised on the unavailability of his file.” « On Pg. 6 of Defendants’ memorandum Defendants make reference to the Court’s pointed observation about the viability of Plaintiff's claims. (P. 23 of Court transcript annexed to the Kutner affirmation as Exhibit “A”.) It is to be noted (and it is detailed in the accompanying Kutner affirmation) that the Court’s comments occurred after Defendants’ counsel had made multiple misstatements about the status of Dr. Forman’s credentialing file. Plaintiffs have set forth valid causes of action against the Defendants sounding in gross negligence, negligence, breach of implied contract, breach of the implied covenant of good faith and fair dealing and for violations of two separate provisions the New York State Public Health Law. As is more fully discussed below each of these causes of action should be sustained and Defendants’ motion to dismiss should be denied in its entirety. There is also clearly nothing 5 frivolous or sanctionable here. In addition, Defendants attempts to miscast this case or Plaintiff's damages as being barred by the doctrine of collateral estoppel are unjustified and inappropriate. Finally, to the extent deemed necessary, by the Plaintiff should be given the opportunity to amend the complaint in the form annexed to the Kutner affirmation since Defendants are moving to dismiss this complaint and there is no prejudice. DR. FORMAN SHOULD NOT HAVE TO MOVE FOR LEAVE TO AMEND On January 7, 2015, the Court directed Plaintiff to file an amended complaint as Plaintiff was permitted to do so as of right. Plaintiff thereupon filed its First Amended Verified Complaint in the form annexed to the Kutner affirmation as Exhibit “B”. Defendants’ counsel, however, now protests because the First Amended Verified Complaint differs in content from the one annexed to Plaintiff's prior cross-motion. As set forth in the Kutner affirmation, however, Plaintiff's counsel understood that he could amend the pleading as of right and thereupon the pleadings were amended to delete Iron Mountain as a party, eliminate several causes of action, supplemented several other claims and added one claim. More than a week after Defendants’ counsel was served with both a redline and non-redline copy of the First Amended Verified Complaint he executed a stipulation of discontinuance which was required by the clerk of the Court prior to filing of the amended complaint. Defendants’ counsel did not object to the document at the time, has moved to dismiss and in all events there has been no prejudice. Defendants’ counsel also cites the case of Pomerance v. McGrath, 2014 NY Misc. Lexis 265, a case which involved multiple instances of filing without leave of the Court for the proposition that Plaintiff now needs Court permission to file its First Amended Verified 6 Complaint even though Plaintiff has already moved to dismiss on other grounds. In citing Pomerance v. McGrath, however, Defendants’ counsel neglects to mention that the Court in Pomerance, Justice Jaffe, subsequently, actually granted the Plaintiff's cross-motion to replead and denied the Defendants’ motion for sanctions, finding: “Following submission of the instant motion, | granted plaintiff permission to submit a revised complaint, and permitted the parties to submit new papers in light of it, advising them that papers previously submitted on the motion would also be considered. Plaintiff thereafter filed a proposed amended complaint dated February 19, 2014 (NYSCEF 190), now addressed.” “A party is prejudiced within the meaning of CPLR 3025(b) when it “has been hindered in the preparation of his case or has been prevented from taking some measure in support of his position.” (Loomis v. Civetta Corinno Const. Corp.. 54 NY2d 18, 23 [1981}). “That a defendant will be compelled to expend additional resources in preparing its case or that it now faces greater liability as a result of the amendment does not constitute prejudice.” (Jacobson v. McNeil Consumer & Specialty Pharm. 68 AD3d 652, 654 [1* Dept 2009)). Here Plaintiff received permission to amend as of right and Defendants have sustained no prejudice. Defendants also cite Walden v. Nowinksi, 63 AD2d 586, 1" Dept 1978, as authority for the proposition that Plaintiff needs to move for permission to replead without mentioning that in said case the Court granted Plaintiff leave to renew the cross-motion on submission of proper papers. In all events Plaintiff has not acted in a frivolous matter. Instead, he voluntarily discontinued the action against Iron Mountain, withdrew several causes of action, added one cause of action and supplemented some allegations. STATEMENT OF FACTS This action involves the wrongful actions on the part of Defendants MERCY MEDICAL CENTER, CATHOLIC HEALTH SERVICES OF LONG ISLAND (hereinafier “Mercy,” 7 “Catholic Health Services” or “Defendants”) in failing to maintain Plaintiffs physician credentialing file for the more than two decade period while he served as an anesthesiologist on the medical staff at Mercy and in intentionally and/or negligently destroying such records or permitting, directing or acting in concert with a non-party, IRON MOUNTAIN INC. (“IRON MOUNTAIN”) to destroy said records and in failing to timely apprise Plaintiff that his records had been destroyed. Plaintiff seeks to recover damages occasioned by Defendants’ gross negligence and ordinary negligence, recklessness and intentional acts, by which Defendants directly or intentionally caused the destruction of Plaintiff's credentialing file which represented his entire twenty-one year professional care at Mercy Hospital. In destroying, authorizing or permitting the destruction of such records Defendants acted in a willful and reckless disregard of Plaintiff's rights and violated the Public Health Law as well as its own bylaws and risk management rules. Most importantly, because of the destruction of his records Dr. Forman has been effectively precluded from ever again working as an anesthesiologist for a hospital causing his career to come to a dead halt. Furthermore, Dr. Forman had no way of knowing his records no longer existed when he was seeking employment from multiple health care institutions or when he sought consulting work. According to the affidavits and correspondence provided by Defendant Mercy in response to a subpoena to produce Dr. Forman’s records in another lawsuit, the destruction of Plaintiff's credentialing file in August of 2012 during the time when Defendants Mercy and Catholic Health Services were aware that Plaintiff was a “Relator” in a “whistleblower” qui tam case involving anesthesia health care fraud billing against an unrelated, nonparty hospital group. The destruction of Dr. Forman’s credentialing file conceivably prevented disclosure of documents that may have 8 supported similar claims against Defendants had Dr. Forman’s records become public. To protect its interests, Defendants intentionally destroyed or enlisted non-party Iron Mountain to act in concert with them to destroy Dr. Forman’s records on Mercy’s behalf and to protect itself from liability both financially and to its reputation. Among other things, during said period of time, Edward Siems, Director of Anesthesia at Mercy called Plaintiff each time an article appeared about Plaintiff's involvement with the gui fam case and another case brought against an insurance company. Dr. Siems wanted to know if Plaintiff had ever mentioned Mercy during the course of those cases. Also, Plaintiff as early as 2009 had informed Mercy’s Medical Director John Reilly of the 370 double billing issue. Undoubtedly, motivation existed on the part of Defendants to destroy Dr. Forman’s files. Defendants’ submissions in connection with this motion offer nothing to refute the factual allegations set forth in Dr. Forman’s First Amended Verified Complaint, a copy of which is annexed to the Kutner affirmation as Exhibit “B”. Defendants” actions have unquestionably caused irreparable harm to Dr. Forman’s professional reputation and career. The Defendants’ actions were arbitrary, groundless, negligent, grossly negligent and irresponsible and in breach of their contractual, statutory, fiduciary and moral obligations owed. Dr. Forman has also alleged that Defendants and Iron Mountain’s actions were also part of a larger pattern of fraud and neglect and breach of duty. THE PARTIES Dr. Forman Plaintiff, Berton Forman, M.D. is an anesthesiologist who has been licensed to practice medicine by the State of New York for more than thirty years. Dr. Forman is also a recognized 9 expert in ascertaining the existence of medical fraud and has a particular expertise in identifying over billing on the part of physicians and other health care providers and in particular the auditing of the claims and records of hospitals and has a proven record in identifying and assisting in the recovery of funds fraudulently or otherwise improperly paid to such physicians who are engaged in the practice of anesthesiology. Since November 30, 2004 Dr. Forman has been the owner of a United States Patent for Health Care Fraud Software Systems, Patent # 6,826,356b1, for a healthcare monitor system for detecting healthcare fraud. The patent has twelve different claims accepted as being unique and patentable by the United States Patent and Trademark Office. Dr. Forman was also a whistleblower or “relator” having successfully brought an action pursuant to the Whistleblower Protection Act of 1982 as amended, against an unrelated nonparty hospital group. Said action resulted in the hospital group agreeing to greater transparency when billing their anesthesia revenue codes. Whistleblowers are awarded federal protection under the Whistleblower Protection Act of 1989, as amended, and may file complaints that they believe reasonably evidence a violation of law, rule or regulation, gross mismanagement, gross waste of, funds, an abuse of authority, or a substantial and specific danger to public health or safety. Defendants Defendant Mercy Medical Center is a hospital and is part of the Defendant Catholic Health Services System. Mercy is located in Rockville Centre, New York. According to its website Mercy is a 375 bed hospital facility, with more than 700 physicians, and a staff of 1,100. Defendant Catholic Health Services of Long Island is the largest faith-based health care system on Long Island and is comprised of six hospitals and various health and human services agencies. Catholic Health Services of Long Island proclaims as its mission that it affirms the 10 sanctity of life, advocates for the poor and underserved, and serves the common good. It also proclaims that it conducts its healthcare practice, business, education and innovation with justice, integrity and respect for the dignity of each person. ADDITIONAL BACKGROUND Defendants’ actions directly or indirectly caused the wholesale destruction of Dr. Forman’s quality care and credentialing records for the entire twenty-one year period during which he provided anesthesia services as an attending physician to Mercy. During such period, from 1989 until February 2010 Dr. Forman handled as many as fifteen thousand (15,000) cases. Thus Dr. Forman’s more than two decade history of care and treatment of patients has been completely eradicated. As an anesthesiologist Dr. Forman’s services are necessarily hospital based and thus for all intents and purposes require him to have a hospital affiliation. Further, as discussed below Public Health Law Sec. 2805-j and k mandate, among other things, that the hospital must preserve Dr. Forman’s credentialing file and also that before Dr. Forman or any other physician can be accredited to work in a hospital he must first produce the records from his prior hospital affiliations. The failure to produce such records, particularly when the physician has only worked in one place for the past two decades gives rise to an inference that Dr. Forman, an anesthesiologist did something wrong. And it is not difficult to imagine what someone might think about an anesthesiologist, who did something wrong. And while the defendants attempt to minimize and misstate the impact this destruction had has on Dr. Forman’s career by falsely stating that is purported inability to demonstrate damages in his legal malpractice case precludes him from recovering here fact of the matter is the destruction of Dr. Forman’s quality care and 11 credentialing file therefore precludes him from affiliating with another hospital to practice his chosen profession and specialty. Moreover, Dr. Forman has confirmed he made efforts to obtain an education based affiliation at a time when he was unaware of the destruction of his credentialing file. This is also confirmed by among other things the Public Health Law and by Mercy’s own bylaws. See e.g. Article V of the bylaws, Procedure for Appointment and Reappointment requiring extensive information concerning applications for employment. Also, section 1(b): “The applicant shall have the burden of producing adequate information for proper evaluation of his/her current competence, current license, relevant training or experiences, Board status and health status as it relates to the ability to perform the privileges requested, character, ethics, and qualifications for resolving any doubts about such qualifications.” (See Exhibit “H” to the Kutner Affirmation). Mercy’s own bylaws confirm that they would not have hired Dr. Forman had he now sought employment with them. If Mercy would not hire someone without a credentialing file why would they expect anyone else to. Therefore Defendants should not be permitted to exculpate themselves from liability as they were responsible for and had a non-delegable duty to Dr. Forman pursuant to the New York State Public Health Law to make sure his files were properly maintained and not destroyed. Dr. Forman did not become aware of the destruction of his records in January 2013 nearly three years after he left Mercy. From 2010 to January 2013, Mercy concealed from Dr. Forman the fact that his records were transferred. Ultimately, they only divulged the truth when they were legally compelled to respond to a subpoena in an unrelated legal malpractice proceeding. This is confirmed by the affidavit of David Mandel, annexed to the Kutner Affirmation as Exhibit “I’”) which provides: 12 That on February 4, 2010 Dr. Forman resigned from the Medical Staff at Mercy Medical Center. That on March 31, 2010, Dr. Forman’s credentialing and Quality file were received by an offsite storage facility. That on August 24, 2012 there was an inadvertent destruction of Dr. Berton Forman’s credential and quality file at the offsite storage facility. That on December 18, 2012 I became aware that the credential and quality files of Dr. Berton Forman had been destroyed via secured shredding. The foregoing confirms that as of January 8, 2013, nearly three years after Dr. Forman resigned from Mercy Medical Center, and after Dr. Forman had been seeking employment having no knowledge that his records were missing Mercy Medical Center inexplicably revealed for the first time that Dr. Forman’s records not only were shipped to someone else but also that they did not exist and were allegedly destroyed by the non-party Iron Mountain. None of the circumstances as to their destruction have ever been made known to Plaintiff which begs the question whether only Plaintiffs records were involved. By their affidavits, Defendants admitted that Dr. Forman’s records, the entire written history of his twenty one year history of successfully and professionally rendering medical services at Mercy Medical Center had been destroyed. Also see letter dated February 25, 2013, a copy of which is annexed to the Kutner Affirmation as Exhibit “J, from Brice Beach, at attorney at Defendant Mercy to Dr. Forman’s then attorney which stated in pertinent part: ... “In January 2013 Risk Management at the Hospital was served with a subpoena Duces Tecum requesting Dr. Forman’s files. Risk Management, as well as David Mandel, sent an affidavit to the Court stating that the requested files do not exist as they were inadvertently destroyed by Iron Mountain, an offsite third-party vendor 13 who stores files for the Hospital.” Mr. Mandel’s affidavit is more instructive for what it does not say as opposed to for what it says in that it confirms that Dr. Forman, who resigned from the medical staff at Mercy Medical Center on February 4, 2010 was not even told that his credentialing and quality care file were sent to Defendant Iron Mountain, an offsite storage facility. Presumably, Mercy was aware, by virtue of its own bylaws as well as other statutory and regulatory requirements, that Dr. Forman or any prospective institution including hospitals that Dr. Forman would seek to become affiliated with would have reason and need to access these and other Public Health law mandated materials at some future date for either personal or professional reasons. In all events, it seems more than coincidental that Dr. Forman’s credential and quality file were allegedly “inadvertently destroyed” on August 24, 2012, more than two and a half years after he resigned from Mercy and while the gui ‘am case which involved fraudulent revenue code 370 over billings by hospitals, was going full steam. Noteworthy is the fact that the whistleblower case brought by Dr. Forman shined a spotlight on the world of hospital billing practices with national implications, something that the Defendants were not pleased with. Also during the time period noted above, Dr. Forman successfully resolved an action he brought against an insurance company which had retained him to locate fraud in medical bills. As a consequence of his engagement by this insurance company Dr. Forman uncovered tens of millions of dollars in fraudulent overbilling on the part of hospitals throughout the United States. MERCY AND CATHOLIC HEALTH SERVICES WERE REQUIRED TO MAINTAIN DR. FORMAN’S CREDENTIALING FILE Pursuant to §2805-j et seq. of the New York Public Health Law all hospitals in the State 14 of New York are required to create and maintain reports as part of the Hospital’s Quality Assurance Program. Included within the reports that hospitals are required to maintain are the individual credentialing files for physicians. The credentialing files of all attending physicians are created, maintained and utilized for among other reasons the purpose of evaluating physicians who are members of the Hospital’s staff as required by the Public Health Law. NY Public Health Law §2805-j provides in relevant part as follows: I Every hospital shall maintain a coordinated program for the identification and prevention of medical, dental and podiatric malpractice. Such program shall include: a) The establishment of a quality assurance committee with the responsibility to review the services rendered in the hospital in order to improve the quality of medical, dental and podiatric care of patients and to prevent medical, dental and podiatric malpractice. Such committee shall oversee and coordinate the medical, dental and podiatric malpractice prevention program and shall insure that information gathered pursuant to the program is utilized to review and to revise hospital policies and procedures... b) A medical, dental and podiatric staff privileges sanction procedure through which credentials, physical and mental capacity and competence in delivering health care services are periodically reviewed, and reviewed as otherwise warranted in specific instances and circumstances, as part of an evaluation of staff privileges; e) The periodic review and the review as otherwise warranted in specific instances and circumstances of the credentials, physical and mental capacity and competence in delivering health care services of all persons who are employed or associated with the hospital; 4) A procedure for the prompt resolution of grievances by patients or their representatives related to accidents, injuries, treatment and other events that may result in claims of medical, dental or podiatric malpractice; e} The maintenance and continuous collection of information concerning the hospital’s experience with negative health care outcomes and incidents injurious to patients, patient grievances, professional liability premiums, settlements, awards, costs incurred by the hospital for patient injury prevention and safety improvement activities; The maintenance of relevant and appropriate information gathered pursuant _to paragraphs (a) through (e) of this section concerning individual physicians dentists and_podiatrist_within the physician’s, dentist’s or _podiatrist’s personnel_or credential file maintained by the hospital. (emphasis added). 15 Dr. Forman cannot obtain employment as a physician with a hospital or facility approved by Article 28 of the Public Health Law unless he can provide such entity with the materials from his credentialing file. See Public Health Law § 2805-k (Investigations prior to granting or renewing privileges) which provides: 1. Prior to granting or renewing professional privileges or association of any physician, dentist or podiatrist or hiring a physician, dentist or podiatrist, a hospital or facility approved pursuant to this article shall request from the physician, dentist or podiatrist and the physician, dentist or podiatrist shall be required to provide the following information: (a) The name of any hospital or facility with or at which the physician, dentist or podiatrist had or has any association, employment, privileges or practice; (b) Where such association, employment, privilege or practice was discontinued, the reasons for its discontinuation; (c) Any pending professional medical, dental or podiatric misconduct proceedings or any pending medical malpractice actions in this state or another state, the substance of the allegations in such proceedings or actions, and any additional information concerning such proceedings or actions as the physician, dentist or podiatrist may deem appropriate; (d) The substance of the findings in such actions or proceedings and any additional information concerning such actions or proceedings as the physician, dentist or podiatrist may deem appropriate; {e) A waiver by the physician, dentist or podiatrist of any confidentiality provisions concerning the information required to be provided to hospitals pursuant to this subdivision; and (f) Documentation that the physician, dentist or podiatrist has completed the course work or training as mandated by section two hundred [fig 1] thirty-nine of this chapter or section six thousand five hundred five-b of the education law. A hospital or facility shall not grant or renew professional privileges or association to a physician, dentist, or podiatrist who has not completed such course work or training. (g) A verification by the physician, dentist or podiatrist that the information provided by the physician, dentist or podiatrist is true and accurate. 2. Prior to granting privileges or association to any physician, dentist or podiatrist, or hiring a physician, dentist or podiatrist, any hospital or facility approved pursuant to this article shall request from any hospital with or at which such physician, dentist or podiatrist had or has privileges, was associated, or was employed, the following information concerning such physician, dentist or podiatrist: 16 (a) Any pending professional medical conduct proceedings or any pending medical malpractice actions, in this state or another state; (b) Any judgment or settlement of a medical malpractice action and any finding of professional Misconduct in this state or another; and (c) Any information required to be reported by hospitals pursuant to section twenty-eight hundred three-e of this article. Finally, Mercy’s own bylaws, relevant excerpts of which are annexed to the Kutner affirmation and are cited therein provide that all applications for medical staff shall require detailed information concerning the applicants professional qualifications including “adequate information for proper evaluation of his/her competence, current licensure, relevant training, Board status and health status.” ARGUMENT POINT I PLAINTIFF HAS SET FORTH VALID CAUSES OF ACTION IN HIS FIRST AMENDED VERIFIED COMPLAINT Each of Dr. Forman’s causes of action asserted against Defendants are sustainable as a matter of law. The Court of Appeals has held that on a CPLR 3211(a)(7) motion to dismiss, the pleading is to be afforded a liberal construction accepting all alleged facts as true and giving Plaintiff the benefit of every possible favorable inference to determine only whether the facts as alleged fit any cognizable legal theory. Leon v. Martinez, 84 N.Y. 2d 83 (1994). "The criterion is whether the proponent of a pleading has a cause of action, not whether he has stated one." Id. At 88. See also, Wiener v. Lazard Freres & Co., 241 A.D. 2d 114 (1" Dept 1988), and Friedman v. Friedman, 141 A.D. 2d 401 (1" Dept 1988). The motion must be denied, if from the pleadings four comers, "factual allegations are discerned which taken together manifest any cause of action cognizable at law." (Richbeil Info Servs., Inc. v. Jupiter Partners, L.P., 309 17 A.D. 2d 288, 289, 765 N.Y.S. 2d 575 [1 Dept 2003]). See also, UB.A. Inc. v. New York City Taxi & Limousine Commission, 161 A.D. 2d 202 (1* Dept 1990), Scott v. Bell Atlantic Corp., 282 A.D. 2d 180 (1" Dept 2001). Where such factual allegations exist, the motion should be denied. Ackerman y. 305 East 4dh Owners Corp. 189 A.D. 2d 662 (1* Dept 1993). As set forth herein applying this standard, each of Plaintiff's causes of action asserted against Defendants are sufficient and should not be dismissed. POINT II DR. FORMAN HAS STANDING TO SUE UNDER PUBLIC HEALTH LAW §2805-j AND k Defendants disingenuously argue that Dr. Forman lacks standing to sue under Public Health Law § 2805-j and k which they contend does not confer upon him a private right of action. More specifically, they contend that Dr. Forman is not entitled to sue for money damages as a result of Mercy’s non-compliance with the statute. Defendants’ analysis is flawed, however, for several reasons. First, Defendants’ would offer no remedy for violating the law. In essence, Defendants’ contention is that there should be no consequences for a violation of the statute even though, as discussed below, one of its purposes was to offer protection to physicians. Such an interpretation would no doubt be anathema to the stated purpose behind Section 2805-j and k in the first place. Since Dr. Forman is undoubtedly a member of the class of persons for whom the statute was designed to protect, however, Defendants’ argument is clearly erroneous under applicable law. On the question of standing, the courts of New York have noted that this is a threshold issue and a litigant must establish standing in order to seek judicial review (see Society of Plastics Indus v. County of Suffolk 77 N.Y.2d 761, 769, 772). The burden of establishing standing is on 18 the party seeking review (id.). An individual’s standing hinges on the following criteria: (1) the harm asserted must be arguably within the zone of interest to be protected by the statutory or constitutional provisions sought to be enforced; (2) the decision for which review is sought must be shown to have a harmful effect upon the party asserting standing; and (3) there must be no clear legislative intent negating review (see, Matter of City of New York v. City Ciy. Serv. Common., 60 N.Y.2d 436, 442-443 (1983), citing Matter of Dairylea Coop. v. Walkley, 38 N.Y.2d 6, 8-11, and Matter of Bradford Cent. School Dist. v. Ambach, 56 N.Y.2d 158, 163-164. Article 28 of the Public Health Law is replete with references to its legislative purpose, i.e. for the protection of both consumers of health care as well as physicians. See e.g. Legislative Findings and declaration. L. 1985 ¢. 294, §1, eff July 1, 2985, “The 1985 Medical Malpractice Reform Act”: “The legislature hereby finds and declares that a comprehensive reform of the medical and dental malpractice adjudication system is necessary in order to ensure the continued availability and affordability of quality health care services in New York State. Escalating malpractice insurance premiums discourage physicians and dentists from initiating or continuing their practice in New York and contribute to the rising cost of health care as premium costs are passed along to the health care consumer... By expediting case resolution, discouraging frivolous claims and defenses, moderating attorney contingency fees, limiting the opportunity for double recoveries and requiring the periodic payment of large future awards, the Legislature intends to reduce the escalating cost of malpractice insurance and to improve the adjudication of malpractice claims. The legislature further finds that hospitals must enhance their efforts to reduce medical and dental malpractice through the establishment of medical and dental malpractice prevention programs and through greater scrutiny of physicians and dentists prior to granting hospital privileges and that increased scrutiny of hospital privileges and that increased resources should be devoted to the investigation and prosecution of p