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Texas Supreme Court throws out Houston heart surgeon’s $6 million award

The high court disagreed with a jury that statements made by a Houston hospital system's employees had damaged the surgeon's reputation.

(CN) — Jurors misinterpreted a jury charge in finding a Houston hospital system had defamed a heart surgeon, the Texas Supreme Court ruled Friday, tossing a $6.3 million verdict awarded to the doctor and his business.

The high court’s order ends a dispute that started in 2012 when Dr. Miguel A. Gomez sued Memorial Hermann Health System, claiming it had caused referrals to his heart practice to decline by sharing flawed data showing his patients had high mortality rates.

Memorial Hermann has a long history in Greater Houston. Founded in 1907, the nonprofit health system now operates 17 hospitals, eight cancer centers and numerous rehab facilities across the region.

By the late 2000s, Memorial Hermann’s Memorial City site had become the preferred hospital in West Houston for heart procedures.

Its dominance waned, however, when Methodist Hospital broke ground on a hospital in the same area and started recruiting from Memorial Hermann’s ranks, including Gomez, who had developed a reputation as an excellent heart surgeon known for his robotic-assisted procedures.

Gomez signed an agreement with Methodist in 2009 giving him privileges at its hospital, which opened in 2010, and continued his practice at Memorial City.

Methodist hired Gomez despite a warning it had received from Memorial Hermann employee Jennifer Todd. She told Methodist staffer Cyndi Peña she had heard talk Gomez’s patients had high mortality rates and he was doing unnecessary surgeries.

The case hinged on Todd’s statement, and another made to Gomez by Byron Auzenne, whom Memorial Hermann hired in 2009 to lead its heart service and vet cardiologists’ concerns its heart surgeons had high mortality rates.

Gomez claimed that to prevent him from taking his referrals from its hospital to Methodist’s, Memorial Hermann had shared flawed mortality data from a metric Auzenne created based on raw data that was not risk-adjusted to consider if, for example, his patients who died were smokers, very old, obese, or suffering from kidney failure.

Gomez thought the issue had been laid to rest after the chair of Memorial Hermann’s surgical peer-review committee in early 2010 concluded there were no quality-of-care issues among the hospital’s heart surgeons, and the non-risk-adjusted data gave a flawed picture of a surgeon’s quality of care

But Memorial Hermann continued to use the data.

Gomez testified in a three-month trial held in 2017 that Auzenne had told him in 2011 he had discussed the data with the hospital’s CEO and they felt the “data needed to be shared, that we needed to be a transparent organization, that this was a safety issue,” and he had shown them to other physicians who referred patients to Gomez so they could make informed decisions.

The jury determined the two statements had defamed Gomez and awarded him $3.3 million for injury to his reputation and mental anguish. It also found the statements constituted business disparagement of Gomez’s physician association and awarded it $3 million for lost profits.

Memorial Hermann appealed to the Texas Supreme Court after the First Texas Court of Appeals in Houston upheld the verdict.

The state high court heard arguments last October. It reversed the First Court of Appeals on Friday and rendered a take-nothing judgment for Memorial Hermann.

In a unanimous opinion, Chief Justice Nathan Hecht found the jury had strayed from the plain text of the jury charge and its common sense meaning.

In the charge, the jury was asked if Memorial Hermann, through the statements made by its employees, Auzenne and Todd, about Gomez’s patient mortality issues had defamed Gomez and disparaged his physician association.

The charge set out in quotation marks the two employees’ statements about Gomez. “The use of quotation marks gave the jury the ‘exact phraseology’ they were to consider,” Hecht wrote in his 25-page ruling.

In trial testimony, Auzenne denied telling Gomez he had discussed his patient mortality data with Memorial Hermann’s CEO and he had shared it with doctors who refer patients to Gomez.

And Peña testified that when Todd told her she had heard rumors Gomez’s patients had high mortality rates, it was not news to her because, as she put it, the information was “kind of everywhere.”

The Texas Supreme Court determined that instead of focusing on if Auzenne’s statement had damaged Gomez’s reputation, as instructed in its charge, the jury had focused on the mortality data Auzenne referred to in his statement.

“The charge directed the jury to consider Auzenne’s statement to Gomez, not Auzenne’s use of the individual surgeon mortality data,” Hecht wrote. “There is no evidence that Auzenne’s statement to Gomez was published. Gomez does not dispute this. The trial court erred in awarding Gomez damages for defamation and business disparagement arising out of the Auzenne statement.”

In further agreement with Memorial Hermann, the court found Gomez had not proven Todd’s statement about him to Peña had damaged his practice, emphasizing that Methodist West still chose to hire him and even appointed him to two administrative positions at its hospital.

After a confrontation with Memorial Hermann’s CEO, Gomez resigned his privileges at Memorial City in April 2012 and moved his practice entirely to Methodist West.

His attorney, Timothy Lee of the Houston firm Ware Jackson, did not respond Friday to a request for comment on the order.

Memorial Hermann said it is pleased to have prevailed in the case after 10 years of litigation.

"Our purpose of reviewing quality data and sharing it within a privileged medical committee process was to improve the quality of care and patient safety. Memorial Hermann is continuously looking for opportunities to better patient outcomes and ensure our patients are receiving the highest quality and safest care possible," its media relations team said in an emailed statement.

Memorial Hermann said its commitment to patient safety was recognized in 2012 when it became the first health system in Texas to be awarded the Eisenberg Patient Safety Award by the National Quality Forum and The Joint Commission, the oldest health care accrediting body in the U.S.

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Categories / Appeals, Business, Health, Regional

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