Moore v. Williamsburg Regional Hospital

PUBLISHED

UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

BLAKE H. MOORE, MD, FACS, 
Individually and as the Personal
Representative of the Estate of
Angela Lynn Moore; KINGSTREE
SURGICAL ASSOCIATES, LLC,
Plaintiffs-Appellants,
v.
WILLIAMSBURG REGIONAL HOSPITAL;
JOHN HALES; BRETON JUBERG, MD;
EVELYN ANSA, MD; JOEL
BONAPARTE, MD; BERNADETTE
BONAPARTE, MD; KENNETH
JOHNSON, MD; STEVE COREY,
DPM; MICHELLE COREY-  No. 07-1966
BUTTERWORTH, DPM; KEVIN
SPRINGLE, MD; GILBERTAS RIMKUS,
MD, Jointly and Severally,
Defendants-Appellees,
and
RAYMOND ALLEN, MD; BASHIR
OBEIDOU, MD; MARION RIGGS,
Jointly and Severally,
Defendants,
PROVIDENCE HOSPITAL,
Party in Interest.

2 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
Appeal from the United States District Court
for the District of South Carolina, at Florence.
Terry L. Wooten, District Judge.
(4:05-cv-02940-TLW)

Argued: December 3, 2008

Decided: March 12, 2009

Before WILKINSON, DUNCAN, and AGEE,
Circuit Judges.

Affirmed by published opinion. Judge Wilkinson wrote the
opinion, in which Judge Duncan and Judge Agee joined.

COUNSEL

ARGUED: Charles William Hinnant, Jr., MEDICOLEGAL
CONSULTANTS, L.L.C., Anderson, South Carolina, for
Appellants. Travis Dayhuff, NELSON, MULLINS, RILEY &
SCARBOROUGH, L.L.P., Columbia, South Carolina, for
Appellees. ON BRIEF: Stuart M. Andrews, Jr., NELSON,
MULLINS, RILEY & SCARBOROUGH, L.L.P., Columbia,
South Carolina, for Appellees Williamsburg Regional Hospi-
tal and John Hales; Marian Williams Scalise, Lydia L. Magee,
RICHARDSON, PLOWDEN & ROBINSON, Myrtle Beach,
South Carolina, for Appellees Breton Juberg, MD, Evelyn
Ansa, MD, Joel Bonaparte, MD, Bernadette Bonaparte, MD,
Kenneth Johnson, MD, Steve Corey, DPM, Michelle Corey-
Butterworth, DPM, Kevin Springle, MD, and Gilbertas Rim-
kus, MD.
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 3
OPINION

WILKINSON, Circuit Judge:

In this case, a physician brings multiple state law and fed-
eral due process claims against a hospital and its officials for
suspending his staff privileges based on allegations that he
had sexually abused his adopted daughter. While the scope of
immunity under the Health Care Quality Improvement Act,
42 U.S.C. § 11101 et seq., certainly has limits, we think the
immunity attaches to defendants under the circumstances
here, and plaintiff’s state law claims fail in any event. We also
reject plaintiff’s claims that the hospital’s suspension of his
privileges violates the Due Process Clause, both because the
decision to suspend plaintiff’s privileges was not state action
and because the procedures afforded plaintiff satisfied the
Fourteenth Amendment. For these reasons, we affirm the dis-
trict court’s grant of summary judgment to defendants.

I.

Plaintiff is a general surgeon who treats both children and
adults in the course of his practice. He formerly held privi-
leges at Williamsburg Regional Hospital ("WRH") in Kings-
tree, South Carolina. WRH serves a population of fewer than
40,000 people and was previously the Williamsburg County
Memorial Hospital. Since October 2001, it has operated as a
private non-profit corporation, but the state continues to be
involved: the Governor approves the Board of Directors and
the state and county provide funding. While practicing at
WRH, plaintiff raised numerous complaints about patient care
at the hospital, including fatal mistakes in medication dosages
and the mishandling of human tissue specimens. He alleges
that WRH officers threatened him for voicing these com-
plaints and took the following actions in retaliation.

At some point after the alleged threats, South Carolina
Department of Social Services ("DSS") took plaintiff’s three
4 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
adopted children into emergency protective custody because
of allegations that plaintiff’s wife had physically abused the
children. DSS filed a complaint against plaintiff and his wife
in Family Court and placed the children in foster care. While
in foster care, plaintiff’s adopted daughter told her therapist
that she had been sexually abused by plaintiff and his wife. In
2003, two DSS units each investigated the sexual abuse alle-
gations, but found the evidence to be inconclusive and
declined to investigate further. Then, in 2004, Clarendon
County DSS conducted a third investigation and, after finding
by a preponderance of evidence that plaintiff and his wife had
sexually abused the child, filed a Family Court complaint
seeking to terminate plaintiff’s and his wife’s parental rights
and place them on the Central Registry of Child Abuse and
Neglect.

Soon after DSS filed the complaint, defendant Dr. Breton
C. Juberg, the WRH Chief of Staff and Chairman of the Med-
ical Executive Committee ("MEC"), became aware of the
DSS sexual abuse allegations against plaintiff. He informed
defendant John C. Hales, Jr., the Chief Executive Officer of
WRH, of the allegations, and Hales obtained a copy of the
complaint and other documents from the clerk of the Family
Court. The complaint detailed statements the child made to
her DSS caseworker, therapist, foster parents, and forensic
interviewer about the sexual abuse, and also recounted the
prior physical abuse case that had resulted in a finding of
Abuse and Neglect against plaintiff and his wife. After
reviewing these documents, Hales and Juberg agreed to sum-
marily suspend plaintiff’s hospital privileges until the DSS
sexual abuse allegations were resolved.

In a letter dated September 13, 2004, Juberg notified plain-
tiff that his privileges were summarily suspended pursuant to
the hospital’s Medical Staff Bylaws provisions for corrective
action. Juberg explained that "[b]ased upon serious allega-
tions of sexual misconduct of a minor child . . . the Medical
Staff and [WRH] believe that the best interest of patient care
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 5
and welfare is served by an immediate summary suspension
of your clinical staff privileges." Juberg also notified plaintiff
that the MEC would review his summary suspension that eve-
ning and invited him to present his case, although he would
not be allowed to vote on the matter.

At the meeting, the MEC considered several documents
from plaintiff’s DSS file including the sexual abuse com-
plaint, the DSS probable cause finding, the child’s forensic
interview report, progress notes from her therapy sessions,
drawings by the child, and a Family Court order which
included information about the prior physical abuse case.
Plaintiff attended the meeting and presented argument, but the
MEC ultimately voted to continue his suspension.

Two days later, Hales sent a letter to plaintiff confirming
that the MEC had voted to continue his suspension and
informing plaintiff of his right to have the decision reviewed
in a hearing with representation by counsel pursuant to Article
VIII of the hospital’s bylaws. The next day, WRH submitted
a report to the National Practitioner Data Bank ("NPDB"), as
it believed was required by 42 U.S.C. § 11133,1 stating that
plaintiff’s clinical privileges had been summarily suspended
indefinitely because of "serious allegations of sexual miscon-
duct of a minor child."

Plaintiff requested a review hearing which was held on
November 22, 2004. Prior to the hearing, WRH provided
plaintiff a list of witnesses expected to testify and a list of
Hearing Panel members who were not his economic competi-
tors. To accommodate plaintiff’s objection, WRH removed
1
"Each health care entity which—(A) takes a professional review action
that adversely affects the clinical privileges of a physician for a period lon-
ger than 30 days . . . shall report to the Board of Medical Examiners." 42
U.S.C. § 11133. However, as the NPDB Guidebook emphasizes, a suspen-
sion is not reportable when it is due to "administrative reasons not related
to professional competence or professional conduct." See NPDB Guide-
book, at E-21 (September 2001).
6 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
one doctor from the panel who had previously treated plain-
tiff’s children. Plaintiff’s counsel was then notified of the
final panel composition by letter and given an opportunity to
object, but plaintiff did not object before the hearing.

At the hearing, Juberg and plaintiff’s counsel presented
argument. Both sides called witnesses, cross-examined wit-
nesses, and presented documents for the panel to consider.
Plaintiff and his wife testified that they did not sexually abuse
their daughter and presented evidence including the result of
a neuropsychiatric test indicating that plaintiff failed to meet
the diagnostic criteria for pedophilia, a prior DSS notice that
a sexual abuse investigation was unfounded, and a forensic
examination that did not prove sexual abuse. But, during the
two additional months the hearing was held open, plaintiff
was not able to come forward with evidence the panel consid-
ered adequate to dispel its concerns. Ultimately, the panel
issued a report upholding the MEC’s decision to continue
plaintiff’s summary suspension.

Plaintiff appealed the panel’s decision to WRH’s Board of
Directors at a full-blown hearing on April 11, 2005. A week
later, after receiving additional evidence, the four board mem-
bers present voted unanimously to uphold the suspension.
This marked the end of the review process.

A few months later, on July 7, 2005, DSS filed a motion
for voluntary nonsuit with prejudice in the sexual abuse case
against plaintiff on the grounds that it would not be in the
child’s best interests to continue the case. DSS argued that it
would be traumatic for the child to testify and the suit would
not benefit the child because plaintiff’s parental rights had
already been terminated pursuant to an agreement of the par-
ties in the physical abuse case. The Family Court entered an
order granting DSS’s motion for nonsuit on July 11, 2005.

A month later, plaintiff sent a letter to WRH requesting that
his clinical privileges be immediately reinstated because DSS
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 7
had dismissed the sexual abuse suit and no one had ever filed
criminal charges against him. WRH did not reinstate plaintiff,
however, because he would not authorize the hospital where
he had been practicing during his suspension to provide the
necessary credentialing information that WRH needed to rein-
state him in accordance with the bylaws. Plaintiff had also
requested that WRH void its NPDB report and asserts that he
has not been able to accept employment with other health care
providers because of the report.

On October 14, 2005, plaintiff filed this suit. He claims that
WRH, Hales, Juberg, and other WRH staff members are liable
in damages because WRH’s suspension of his privileges vio-
lated various state laws and 42 U.S.C. § 1983. After discov-
ery, defendants filed a motion for summary judgment on all
claims and plaintiff filed a cross-motion for summary judg-
ment on his § 1983 claims. The district court granted defen-
dants’ motion on all counts. The court held that defendants
were entitled to immunity from plaintiff’s state law claims
under the Health Care Quality Improvement Act, 42 U.S.C.
§ 11101 et seq., and that plaintiff’s § 1983 claims failed on
the merits and because WRH was not a state actor. Plaintiff
appeals, and we review the district court’s grant of summary
judgment de novo. See Holland v. Washington Homes, Inc.,
487 F.3d 208, 213 (4th Cir. 2007).

II.

Plaintiff alleges that defendants are liable for intentional
infliction of emotional distress, tortious interference with
existing and prospective contractual relationships, defama-
tion, breach of contract, promissory estoppel, unfair trade
practices, and civil conspiracy. The district court held that
defendants were entitled to immunity from all these state law
damages claims pursuant to the Health Care Quality Improve-
ment Act ("HCQIA"), 42 U.S.C. § 11101 et seq.
8 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
A.

The HCQIA provides immunity from damages to partici-
pants in a "professional review action" if the action meets cer-
tain standards and follows certain procedures. 42 U.S.C.
§ 11111(a)(1). HCQIA provides this immunity as "incentive
and protection for physicians engaging in effective profes-
sional peer review." Id. at § 11101(5). Congress believed that
effective peer review, including mandatory reporting to a
nationwide database, could alleviate the national problem of
"[t]he increasing occurrence of medical malpractice" by "res-
trict[ing] the ability of incompetent physicians to move from
State to State without disclosure or discovery of the physi-
cian’s previous damaging or incompetent performance." Id. at
§ 11101; see also Freilich v. Upper Chesapeake Health, Inc.,
313 F.3d 205, 211-12 (4th Cir. 2002) (discussing the purpose
of HCQIA). However, HCQIA does not provide unqualified
immunity to all peer review decisions. In order to ensure that
such review is effective and not abused, HCQIA only pro-
vides immunity to "professional review actions" based on a
physician’s "competence or professional conduct," 42 U.S.C.
§ 11151(9), and it mandates specific standards and procedures
that must be followed, id. at § 11112(a).

The issue here is whether WRH’s action constitutes a "pro-
fessional review action" within the meaning of HCQIA and
therefore falls within the scope of HCQIA immunity at all.2
2
Section 11151(9) of HCQIA defines "professional review action" as
"an action or recommendation of a professional review body . . . which is
based on the competence or professional conduct of an individual physi-
cian (which conduct affects or could affect adversely the health or welfare
of a patient or patients), and which affects (or may affect) adversely the
clinical privileges . . . of the physician." 42 U.S.C. § 11151(9). It provides
further that "an action is not considered to be based on the competence or
professional conduct of a physician if the action is primarily based on—"
(A) a physician’s association with a professional society, (B) a physician’s
fees or advertising, (C) a physician’s participation in certain types of
health plans, (D) a physician’s association with a private group practice,
"or (E) any other matter that does not relate to the competence or profes-
sional conduct of a physician." Id.
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 9
Plaintiff argues that WRH’s suspension of his privileges is not
a "professional review action" because it was not based on his
"competence or professional conduct." He argues that allega-
tions of sexual abuse outside of the professional context are
not related to his competence or his professional conduct as
a doctor. He urges a stark dividing line between private and
professional conduct and contends that "[n]on-medical allega-
tions" cannot be the basis for professional review actions
because they are only proper when medical expertise is neces-
sary to the determination.

Even though many "professional review actions" are based
on (1) medical conduct at a health care facility that (2)
occurred at some point in the past, see e.g., Gaboldoni v.
Washington County Hosp. Ass’n, 250 F.3d 255, 258 (4th Cir.
2001); Imperial v. Suburban Hosp. Ass’n, 37 F.3d 1026, 1029
(4th Cir. 1994), we think plaintiff’s argument that only such
conduct is covered goes too far. First, when describing allow-
able bases for a professional review action, the statute begins
with the critical term "competence." 42 U.S.C. § 11151(9). A
physician’s competence can be implicated by conduct outside
a health care facility if there is a clear nexus between that con-
duct and the ability to render patient care. Second, the statute
says "professional conduct" rather than "conduct in the course
of medical practice" or "conduct that occurs in the hospital."
Tellingly, therefore, Congress chose to use language that was
somewhat broader than the more specific formulations plain-
tiff suggests. Moreover, the statutory definition includes a
parenthetical defining "professional conduct" to include "con-
duct [which] affects or could affect adversely the health or
welfare of a patient or patients." 42 U.S.C. § 11151(9)
(emphasis added). This parenthetical clearly implies that the
term "professional conduct" is not limited to past medical
conduct that has already affected patient welfare. Instead,
HCQIA immunity allows hospitals to take prophylactic mea-
sures that need not involve proof of improper conduct beyond
a reasonable doubt so long as statutory procedures designed
to protect the reputation and livelihood of the physician have
10 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
been observed. In short, nothing in the statute requires peer
review committees to wait until medical disaster strikes.

Contrary to plaintiff’s position then, HCQIA immunity may
protect review actions based on conduct that has occurred out-
side of the hospital, but could realistically occur or affect
treatment in the hospital. At some point, a peer review com-
mittee could surely conclude that it was only a matter of time
before erratic or destructive behavior outside the medical set-
ting began to manifest itself in patient care. If plaintiff’s view
were accepted, however, peer review committees would never
under any circumstances be permitted to conclude that even
the most advanced cases of alcohol addiction, illegal sub-
stance abuse, incipient dementia, or, as here, sexual miscon-
duct toward children on the part of someone with a pediatric
practice could affect professional "competence." 42 U.S.C.
§ 11151(9). Nor does the immunity depend, as plaintiff sug-
gested at argument, upon whether the peer review decision
required the application of medical expertise. The line
between strictly medical and non-medical expertise would be
a difficult one to draw (must the medical expertise relate to
the physician’s conduct or condition, the nature of the physi-
cian’s practice, or the connection between the two?). Clearly
the "competence" of a physician may be affected by arguably
non-medical difficulties which are manifested outside the hos-
pital: a hopelessly alcoholic physician or one adjudged to be
mentally incompetent could only by happenstance render
competent patient care. Most importantly, the statute did not
adopt plaintiff’s proposed "medical expertise" standard.
Adopting a strict line between professional and private con-
duct, or one based on the need for medical expertise, would
improperly restrict the scope of HCQIA immunity and
thereby involve the courts unduly in matters of hospital gov-
ernance. Congress struck a careful balance between protecting
physicians who are subject to professional review actions and
providing immunity that encourages peer review and protects
patients. Plaintiff’s view of the statute compromises the latter
goal.
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 11
At the other end, the hospital defendants urge us to adopt
a broad interpretation of "professional review action" that
encompasses almost any action based on conduct that might,
in the peer review body’s opinion, one day affect patient care.
Defendants argue that because the whole purpose of HCQIA
was to encourage peer review, Congress meant to provide an
expansive grant of immunity.

The breadth of defendants’ argument ignores the limiting
language of the statute. It can be argued, of course, that
almost any form of private misconduct may have some con-
ceivable impact on a physician’s performance, but no fair
reading of the statute (with its emphasis upon competence and
professional conduct) would indicate Congress intended to go
nearly so far. Human beings are not smooth and rounded peb-
bles, but often contradictory in their habits and traits. A sur-
geon whose personal life might not bear close scrutiny may
nonetheless save lives with his talents in the operating room.

Giving peer review bodies the discretion to suspend staff
privileges and report physicians for largely private defalca-
tions is thus to arm those reviewers with a club that Congress
did not provide. Defendants’ view poses the risk that driving
infractions, messy divorces or custody battles, tax or financial
difficulties only tenuously or speculatively related to medical
competence might fall within the purview of peer review. But
this view is untenable. In no sense did Congress mean to
encourage fishing expeditions into private behavior. A "pro-
fessional review action" requires that the record reflect a clear
nexus between the basis for an "action" or "recommendation"
and a physician’s medical practice. 42 U.S.C. § 11151(9). For
the statute, notwithstanding its generous protections for peer
review, imposes limits on the definition of "professional
review action." The statute uses the word "professional" — a
term that connotes the opposite of "personal"—and further
emphasizes that there are limits on "professional review
actions" by explicitly listing bases for actions which are out-
side of the definition, see 42 U.S.C. § 11151(9)(A)-(E),
12 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
including "any other matter that does not relate to the compe-
tence or professional conduct of a physician." Id. at
§ 11151(9)(E). Defendants’ all-encompassing interpretation
of the immunity would, like plaintiff’s narrow restriction of
it, upset the balance Congress struck.

B.

Both sides therefore advance interpretations that are too
rigid—they treat this as an all-or-nothing matter. But we
decline to adopt the absolute rule of either side in resolving
the matter before us. In this case, there exists a clear nexus
between the alleged sexual misconduct and plaintiff’s medical
practice. We do not infer such a nexus from the representa-
tions of the parties, for the record itself demonstrates a con-
nection between the basis for plaintiff’s suspension and his
medical practice such that the hospital legitimately feared for
patient well-being. While it would serve the interest of no one
to lay bare all the details and disputes surrounding the conduct
at issue, the record indicates that WRH suspended plaintiff
out of a concern that he might sexually abuse child patients
in the course of his practice. As the district court noted, "[t]he
office of the clerk of the Family Court had provided Mr.
Hales, Chief Executive Officer of the Hospital, with docu-
ments regarding the alleged sexual abuse." JA 649. The MEC
reviewed materials from DSS evidencing sexual abuse,
including the DSS investigation report concluding that there
was a preponderance of evidence that plaintiff and his wife
had sexually abused the child, drawings by the child, and
statements made by the child to her therapist, forensic inter-
viewer, and DSS caseworker. JA 905-52. The Hearing Com-
mittee Report stated that plaintiff’s privileges were suspended
based on DSS’s sexual abuse allegations, the prior Family
Court finding of child abuse and neglect, and "the fact that
[plaintiff] has the ability to take care of minor children within
the hospital." JA 880. The Hearing Panel emphasized the "in-
timate relationship between physician and patient" and its
concern for patient safety. JA 881.
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 13
Juberg, Hales, and members of the Medical Executive
Committee each testified that they were concerned that plain-
tiff was a threat to patients, most notably children, at the hos-
pital. Even a member of the MEC who did not think
plaintiff’s suspension was warranted stated that the suspen-
sion was not unreasonable because people "were genuinely
concerned about the safety and welfare of the children in the
community." JA 432. According to Juberg, the hospital con-
sidered limiting plaintiff’s privileges to adult patients and pro-
hibiting him from treating children, but ultimately didn’t
adopt this solution because it believed that "with his history
of violating hospital policy, and because [WRH is] such a
small institution and had really no way of policing or monitor-
ing his goings on," simply limiting plaintiff’s privileges
"would still not protect the patients at the hospital." JA 707.
He emphasized that "[w]e couldn’t be sure that he would not
have contact with children." Id. The same conclusion was
reflected in Hales’ comment that "[m]y main concern was for
children." JA 720. A member of the Board of Directors
declared that the "Board felt that upholding the suspension
was the only reasonable and prudent option we had to ensure
the safety of the patients at the Hospital." JA 838. And at oral
argument, plaintiff’s counsel confirmed a crucial point: that
plaintiff treated children at the hospital.

Certainly the hospital could have considered the relation-
ship between the sexual abuse allegations and plaintiff’s pedi-
atric practice with more particularity, but there is ample
evidence that those involved in plaintiff’s peer review action
recognized the potential for plaintiff to harm patients. The
hospital feared that child abuse could occur on its watch and
therefore was steering between two forms of potential civil
liability: liability for child sexual abuse and liability for sus-
pending a physician.

To be sure, there will be close cases surrounding the scope
of HCQIA immunity. But that should hardly be surprising.
The statutory test that a professional review action must be
14 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
"based on the competence or professional conduct of an indi-
vidual physician (which conduct affects or could affect
adversely the health or welfare of a patient or patients)," 42
U.S.C. § 11151(9), presupposes a certain number of close
calls. That is the case when any general standard is applied to
the particular. But the entire purpose of an immunity provi-
sion is to afford some discretionary latitude to decisionmakers
to make close calls unhaunted by the specter of civil liability.
See Elder v. Holloway, 510 U.S. 510, 514 (1994) ("The cen-
tral purpose of affording public officials qualified immunity
from suit is to protect them ‘from undue interference with
their duties and from potentially disabling threats of liabil-
ity.’").

It may not help therefore to posit future close hypothetical
cases in the abstract, for matters come before decisionmakers
in a far more concrete and factually variegated form. No sin-
gle peer review proceeding precisely replicates another.
Moreover, peer reviewers will not as a practical matter be pre-
occupied with whether something arose in a medical or non-
medical setting, but whether it is of a sufficient dimension to
plainly affect a doctor’s "competence" to practice medicine.
In other words, it would prove problematic to chop the statu-
tory standard into judicially fashioned boxes or categories.
Rather, we should let the statutory test of "competence" stand
simpliciter. In this case, the hospital conducted lengthy pro-
ceedings and saw the matter through three levels of review in
what was manifestly an effort to determine plaintiff’s "com-
petence" to practice medicine. Whether or not we would have
made the same decision ourselves is not the point. Any statu-
tory standard inescapably involves some difficult exercises in
judgment and to deny decisionmakers the right to exercise
judgment in close cases is to defeat the purpose of immunity.

There are of course distinct limits on the scope of HCQIA
immunity, but where as here the record reflects a clear nexus
between the basis for plaintiff’s suspension (evidence of child
sexual abuse) and his medical practice (involving children)
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 15
such that the hospital legitimately feared that plaintiff might
harm child patients, it can be said that the review action was
based on plaintiff’s "competence" to treat children. 42 U.S.C.
§ 11151(9). And conversely, it cannot be said that the review
action was based on a "matter that does not relate to the com-
petence or professional conduct of a physician." Id. at
§ 11151(9)(E). The hospital’s action therefore falls within the
scope of HCQIA immunity.

C.

Having concluded that WRH’s action is a "professional
review action," we turn to the remaining requirements for
HCQIA immunity. There is a statutory presumption that a
professional review action meets the requirements for immu-
nity unless the presumption is rebutted by a preponderance of
the evidence. 42 U.S.C. § 11112(a).

Under § 11112(a)(1), the review action must be taken "in
the reasonable belief that the action was in the furtherance of
quality health care." There is ample evidence that WRH took
the professional review action to protect child patients from
sexual abuse.

Under § 11112(a)(2), the review action must be taken "after
a reasonable effort to obtain the facts of the matter." The hos-
pital engaged in a three-tier review of the initial summary sus-
pension (the Medical Executive Committee, the Hearing
Panel, and the Board of Directors). At every level, the mem-
bers reviewed the evidence collected by DSS, heard wit-
nesses, and gave plaintiff an opportunity to present evidence
and cross-examine adverse witnesses. In fact, the Hearing
Panel held open the record for two months so that plaintiff
could present additional evidence, and it ultimately produced
a 114-page transcript, 70 pages of exhibits, and a detailed
report including findings of fact based on the specific evi-
dence considered. The Board even met twice so that plaintiff
could present additional evidence.
16 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
Under § 11112(a)(3), the hospital must provide plaintiff
"adequate notice and hearing procedures" that are further
specified in § 11112(b). WRH satisfied these requirements.
Plaintiff contends that WRH did not provide an adequate
hearing because members of the Hearing Panel had previously
participated in the MEC vote. We reject this argument
because it is not based on the statutory requirement, which
was satisfied, that the Hearing Panel consist of "individuals
who are appointed by the entity and are not in direct eco-
nomic competition with the physician involved."
§ 11112(b)(3)(A)(iii). Moreover, plaintiff waived any right to
object in this appeal because he did not object to the final
composition of the Hearing Panel when it was convened.
Plaintiff had previously objected to the initial composition of
the Hearing Panel, had been notified of the final panel compo-
sition prior to the hearing, and knew firsthand who had partic-
ipated in the MEC meeting which he had attended. Although
he claims to have objected to the Hearing Panel composition
at the Board of Director’s review of his suspension, he had
already waived any right to object by that point.

Under § 11112(a)(4), the review action must be taken "in
the reasonable belief that the action was warranted by the
facts known." There is evidence that defendants considered
the facts and concluded that a suspension was necessary to
protect patients due to plaintiff’s pediatric practice and the
difficulties of limiting his practice to adults. Plaintiff asserts
that WRH should have proceeded by administrative suspen-
sion and not filed a detrimental report to the NPDB. However,
plaintiff does not point to any requirement in HCQIA that a
hospital must proceed in such a fashion. Absent such a
requirement, where the action is reasonably warranted by the
facts and otherwise meets HCQIA standards, it is valid.
Administrative suspension simply represents another option
for corrective action.

In sum, plaintiff has not met his burden of showing that the
requirements in § 11112(a)(1)-(4) were not met. Therefore
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 17
HCQIA immunity applies and insulates defendants from
plaintiff’s state law damages claims.

III.

We also note as an alternative basis for affirming the judg-
ment that plaintiff’s state law claims would fail in any event.

First, plaintiff claims that the hospital’s conduct constitutes
intentional infliction of emotional distress. This claim fails
because the hospital’s actions were hardly "so ‘extreme and
outrageous’ so as to exceed ‘all possible bounds of decency’"
as required to state a claim for IIED. See Hansson v. Scalise
Builders of S.C., 650 S.E.2d 68, 70 (S.C. 2007) (quoting Ford
v. Hutson, 276 S.E.2d 776, 778 (S.C. 1981)). An attempt by
the hospital to protect its minor patients, even if ultimately
misguided, surely does not "exceed all possible bounds of
decency."

Second, plaintiff claims that the hospital’s peer review
action amounts to tortious interference with plaintiff’s exist-
ing and prospective contracts with the hospital, patients, and
managed care plans. These claims fail because, even if plain-
tiff established the other elements of the torts, plaintiff has not
presented evidence sufficient to establish that defendants’
actions were without justification or were for an improper
purpose. See Camp v. Springs Mortgage Corp., 426 S.E.2d
304, 305 (S.C. 1993) ("absence of justification" is an element
of tortious interference with existing contracts); Crandall
Corp. v. Navistar Int’l Transp. Corp., 395 S.E.2d 179, 180
(S.C. 1990) ("improper purpose" or "improper methods" is an
element of tortious interference with prospective contracts);
see also Restatement (Second) Torts § 767 cmt.f (whether
interference promotes a "public interest" is a factor to deter-
mine whether interference is improper). The action taken here
was not without justification nor is the protection of hospital
patients an improper purpose. The fact that the hospital also
observed HCQIA’s safeguards of procedural fairness blunts
18 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
plaintiff’s claim that any interference with possible contrac-
tual relationships was somehow tortious.

Third, plaintiff claims that defendants are liable for defa-
mation. He argues that they knowingly filed a false report
with the NPDB because they filed the report under the head-
ing of "sexual misconduct" even though the hospital’s action
was based on mere allegations. Plaintiff is correct that the
"basis for action" was listed as "Sexual Misconduct (D1)," but
he fails to mention that this label came from the NPDB list of
Basis for Action Codes and was used by the hospital to con-
form to NPDB formatting requirements. He also takes the
phrase out of context. The report provides:

Description of Act(s) or Omission(s) or Other Rea-
sons for Action Taken: SERIOUS ALLEGATIONS
OF SEXUAL MISCONDUCT OF A MINOR
CHILD.

Basis for Action: SEXUAL MISCONDUCT (D1)

When read in full, the report accurately states what happened:
that the hospital suspended plaintiff’s privileges due to serious
allegations of sexual misconduct. The label "sexual miscon-
duct" is not false; it is simply the most relevant general report-
ing category provided by the NPDB. Furthermore, we doubt
South Carolina law would deny these defendants a defense of
privilege when they could reasonably have believed that they
were required by federal law to report plaintiff’s suspension.
See 42 U.S.C. § 11133 (health care entity is required to report
"a professional review action that adversely affects the clini-
cal privileges of a physician for a period longer than 30
days"); see also 42 U.S.C. § 11137(c) (providing immunity
for HCQIA mandated reports made "without knowledge of
the falsity of the information contained in the report").

Fourth, plaintiff claims that WRH is liable for violating the
hospital bylaws under the theory of breach of contract. Plain-
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 19
tiff, however, points us to no South Carolina decision indicat-
ing that hospital bylaws create such a contractual relationship.
In any event, plaintiff’s claimed violation of Article VIII,
§ 4(a) of the bylaws (that members of the Hearing Panel had
already voted on his suspension as members of the MEC) fails
because, as discussed, plaintiff waived any rights to contest
the composition of the Hearing Panel when he failed to object
at the time the Panel was convened. See Pruitt v. South Caro-
lina Medical Malpractice Liability Joint Underwriting Ass’n,
540 S.E.2d 843, 845 (S.C. 2001) (waiver can be implied by
party’s conduct).

Plaintiff also alleges that WRH breached Article VII, § 2 of
the bylaws by suspending him when it was not immediately
necessary. Section 2 gives the Chairman of the MEC authority
to summarily suspend privileges "whenever action must be
taken immediately in the best interest of patient care." This
claim fails because, given what Juberg knew at the time of his
decision and the difficulties of simply limiting plaintiff’s
practice to adults, it was reasonable for him to believe that he
needed to suspend plaintiff’s medical privileges to protect
patients. For much the same reasons, plaintiff’s claim that
defendants are liable for these breaches under the theory of
promissory estoppel also fails.

Fifth, plaintiff claims that WRH’s "negligent sham peer
review" violates the South Carolina Unfair Trade Practices
Act’s prohibition on "[u]nfair methods of competition and
unfair or deceptive acts or practices in the conduct of any
trade or commerce." S.C. Code § 39-5-20(a). This claim fails
for several reasons. First, plaintiff has not shown that the peer
review was either "an unfair method of competition" or a "de-
ceptive act or practice." The claim also fails because WRH’s
peer review action was not taken "in the conduct of any trade
or commerce" as defined by S.C. Code § 39-5-10(b) since it
did not occur in the conduct of "advertising, offering for sale,
sale or distribution of any services and any property . . . and
any other . . . thing of value." Instead, the peer review action
20 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
was an internal hospital review taken to protect patients. See
Foggie v. CSX Transportation, Inc., 431 S.E.2d 587, 591
(S.C. 1993) (holding that refusal to reinstall railroad crossing
due to concern about crossing accidents was not the "conduct
of trade or commerce").

Sixth, plaintiff claims that defendants are liable for civil
conspiracy. This claim fails because a civil conspiracy must
involve two or more legal entities, Lawson v. South Carolina
Dep’t of Corr., 532 S.E.2d 259, 261 (S.C. 2000), but defen-
dants are one legal entity when engaging in peer review. See
Oksanen v. Page Mem’l Hosp., 945 F.2d 696, 702-03 (4th Cir.
1991) (en banc) (staff members act as agents of the hospital
during peer review). Plaintiff has also failed to show how the
formal peer review process was "conspiratorial" in any real
sense of the word, and plaintiff’s allegations that Hales and
Juberg were acting independently of the hospital for their own
economic interests is on this record little more than specula-
tion.

IV.

Plaintiff also alleges that WRH is liable for damages under
42 U.S.C. § 1983 for depriving him of his medical practice in
violation of the Due Process Clause of the Fourteenth Amend-
ment. HCQIA does not provide immunity from damages for
claims made under the Civil Rights Acts. See 42 U.S.C.
§ 11111(a)(1). This claim nonetheless fails for two reasons:
(1) plaintiff failed to state a § 1983 claim because WRH’s
action was not state action,3 and (2) plaintiff’s substantive and
procedural due process claims falter on the merits.
3
The same analysis applies to whether an action was taken "under color
of state law" as required by § 1983 and whether the action was state
action. See Lugar v. Edmondson Oil Co., Inc., 457 U.S. 922, 935 (1982).
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 21
A.

Plaintiff claims that WRH’s suspension of his privileges is
state action because the hospital’s Board of Directors is nomi-
nated by the county delegates to the state legislature and rati-
fied by the Governor; two county representatives are ex-
officio members of the Board; the hospital receives state and
county funds; and the hospital receives funds through Medic-
aid and the South Carolina State Plan under Title XIX of the
Social Security Act as a public hospital. These facts do not
make WRH’s suspension of plaintiff’s staff privileges state
action.

WRH is currently incorporated as a private non-profit cor-
poration under S.C. Code § 33-31-101 et seq. Previously, the
hospital was Williamsburg County Memorial Hospital and
was organized as a tax exempt Regional Health Services Dis-
trict under S.C. Code § 44-7-2010 et seq. It became a private
hospital on October 1, 2001, when the assets of Williamsburg
County Memorial Hospital Public Service District were trans-
ferred to defendant corporation WRH in accordance with
South Carolina law.4 See S.C. Code § 4-9-82. This does not
end our inquiry, however.
4
For this reason, plaintiff’s arguments based on statements made prior
to October 2001 and those premised on the notion that WRH is a Regional
Health Services District are without merit. Plaintiff argues that the reincor-
poration does not change the status of the District under S.C. Code § 44-
7-2130 which provides: "The reincorporation under Article 16, Chapter 7,
Title 44 of the 1976 Code of any public hospital corporation that hereto-
fore has been designated as the agency of a county . . . in no way impairs
or invalidates this designation and the reincorporated public hospital cor-
poration shall continue as such just as if it had not been so reincor-
porated." This argument fails because the provision only applies when a
District is reincorporated as a "public hospital corporation," see id. at § 44-
7-2150, and because it only applies to determine whether a District contin-
ues to receive special tax revenues from the local government. Id. at § 44-
7-2130.
22 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
Under Modaber v. Culpeper Mem’l Hosp., Inc., 674 F.2d
1023 (4th Cir. 1982), a private entity’s action can constitute
state action if "‘there is a sufficiently close nexus between the
State and the challenged action of the regulated entity that the
action of the latter may fairly be treated as that of the State
itself,’" but "state involvement without state responsibility
cannot establish this nexus." Id. at 1025 (quoting Jackson v.
Metropolitan Edison Co., 419 U.S. 345, 351, 358 (1974)).
The state is deemed responsible for the private entity’s action
"if the private party acts (1) in an exclusively state capacity,
(2) for the state’s direct benefit, or (3) at the state’s specific
behest." Id. Applying this framework in Modaber, we held
that the hospital’s receipt of federal Hill-Burton Act funds, its
acceptance of Medicare and Medicaid patients, and its obliga-
tion to report privileging decisions to the state were not
enough to make the state responsible for the hospital’s privi-
leging decision under Jackson. Id. at 1027.

In this case, most of plaintiff’s arguments relate to WRH’s
receipt of government funds through various state and federal
programs and therefore do not make WRH’s suspension of
plaintiff state action under Modaber. As noted previously,
"the mere fact that the hospitals implement a governmental
program does not establish the nexus which Jackson
requires." Id. at 1026.

Plaintiff contends, however, that this case is distinguishable
from Modaber because government funding is not the only
factor that establishes a nexus between WRH’s action and the
state. Here, in addition, the Board of Directors is nominated
by the county delegates to the state legislature and approved
by the Governor, and two government officials (the county
supervisor and a county representative) serve as ex-officio
members of the Board.

These additional facts, however, do not make the state
responsible for WRH’s privileging decisions. The Governor’s
involvement with the Board ends after he approves the mem-
 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL 23
bers, and plaintiff has not presented any evidence that the
Governor has used his authority to influence privileging deci-
sions. The county representatives may attend the board meet-
ings, but they do not have voting rights and were not present
for the consideration of plaintiff’s suspension. In fact, the
members of the Board who voted were three local bankers
and a school principal. Therefore, it cannot be said that the
Governor or the county representatives were responsible for
WRH’s decision to uphold plaintiff’s suspension. As in
Freilich, "the State plays no role whatsoever in the actual
decision as to whether or not to terminate or reappoint any
particular physician." 313 F.3d at 214 n.3; see also Watts-
Means v. Prince George’s Family Crisis Ctr., 7 F.3d 40, 43
(4th Cir. 1993) (rejecting argument that county representative
on board constituted state action because representative only
had one vote and therefore could not determine the board’s
decision). Therefore, WRH’s suspension of plaintiff’s privi-
leges is not state action.

B.

Plaintiff’s substantive and procedural due process claims
also fail on the merits. Plaintiff claims that WRH violated his
substantive due process rights when it suspended his privi-
leges based on "unproven allegations" and therefore is liable
for damages resulting from, among other things, his lost prac-
tice, loss of reputation and dignity, loss of contracts, and emo-
tional distress. Given the sheer number of tort-like claims
plaintiff raises, it is easy to see through his attempt to make
an end run around HCQIA immunity by turning § 1983 and
the Due Process Clause into the "font of tort law" that the
Supreme Court has consistently rejected. See Paul v. Davis,
424 U.S. 693, 701 (1976); Waybright v. Frederick County,
528 F.3d 199, 204 (4th Cir. 2008) (collecting cases). More-
over, WRH did not just suspend plaintiff on "unproven allega-
tions." WRH engaged in a multi-stage review of evidence
including reports from the child’s therapist and social worker.
Therefore, plaintiff cannot meet the high standard of proving
24 MOORE v. WILLIAMSBURG REGIONAL HOSPITAL
that WRH’s peer review process was "so ‘arbitrary’ and
‘egregious’ that it ‘shocks the conscience,’" and is "unjustifi-
able by any government interest." Waybright, 528 F.3d at 205
(quoting County of Sacramento v. Lewis, 523 U.S. 833, 845-
49 (1998)).

Plaintiff also alleges that WRH did not provide him ade-
quate procedures when it deprived him of his property right
in his medical practice. Plaintiff’s claim fails because the pro-
cedures WRH afforded him exceed the constitutional thresh-
old established by Mathews v. Eldridge, 424 U.S. 319 (1976).
Plaintiff was notified of the allegations against him, given
ample opportunity to present evidence, allowed to call and
cross-examine witnesses, and was represented by counsel
throughout. There was no procedural due process violation.

V.

The loss of clinical privileges is no small matter for a phy-
sician, but we do not believe the hospital treated it as such.
The proceedings here were lengthy and the procedures were
fair. Peer review can be a thankless and time-consuming task
for those involved, but also one that is necessary to uphold the
profession’s ultimate obligations not only to its members but
to the patients that it serves. To put the parties in this case
through further litigation runs the risk of working an injustice
of its own, not simply on the individuals involved but on pro-
spective peer reviewers who would henceforth avoid such ser-
vice at all costs. Such a development would, of course, defeat
the entire purpose of the Health Care Quality Improvement
Act.

For the foregoing reasons, the judgment of the district court
is

AFFIRMED.