Cite as 2019 Ark. App. 544 Digitally signed by Elizabeth ARKANSAS COURT OF APPEALS Perry Date: 2022.08.08 11:39:06 DIVISION I -05'00' No. CV-18-511 Adobe Acrobat version: 2022.001.20169 Opinion Delivered: November 20, 2019
CARROLL “DON” JOHNSON APPEAL FROM THE POPE APPELLANT COUNTY CIRCUIT COURT [NO. 58CV-14-347] V. HONORABLE DENNIS CHARLES POPE EMERGENCY GROUP, LLC SUTTERFIELD, JUDGE
APPELLEE AFFIRMED
RAYMOND R. ABRAMSON, Judge
In 2014, Pope Emergency Group (Pope) had an arrangement with St. Mary’s
Regional Medical Center in Russellville (St. Mary’s) whereby Pope agreed to supply
physicians to staff the hospital’s emergency department. In February 2014, Pope entered
into an agreement with the appellant, Dr. Carroll “Don” Johnson, to provide emergency
room physician services as an independent contractor at St. Mary’s. On June 30, 2014, Dr.
Johnson’s confrontation with a nurse led St. Mary’s to request that Pope remove Dr.
Johnson from the staff of the emergency department, whereupon Pope terminated its
contract with Dr. Johnson.
Dr. Johnson filed a complaint in the Pope County Circuit Court alleging that Pope
and its parent company, Schumacher Group of Arkansas (Schumacher), were liable for
breach of contract and wrongful termination. Dr. Johnson also sued Russellville Holdings, LLC, which owns and does business as St. Mary’s Regional Medical Center. 1 Dr. Johnson
alleged that the hospital tortiously interfered with his contract with Pope and Schumacher.
Pope filed a counterclaim for breach of contract alleging that Dr. Johnson had failed to
return a $30,000 signing bonus as required by the terms of their agreement.
Pope, Schumacher, and St. Mary’s all filed motions for summary judgment,
whereupon Dr. Johnson nonsuited all his claims against them. 2 Pope elected to continue
pursuing its counterclaim, however, and the circuit court granted summary judgment in its
favor in an order entered on February 2, 2017. Dr. Johnson now appeals the circuit court’s
order. We affirm.
I. Facts and Procedural History
Dr. Johnson is a physician who specializes in emergency medicine. In late 2013, after
years of working in Jonesboro, Dr. Johnson decided to return to St. Mary’s, where he had
previously worked as an emergency room physician from 2000 until 2008. The prospect of
Dr. Johnson’s return to St. Mary’s was initially met with some hesitation by the
administration of St. Mary’s and officials at Pope and Schumacher because some patients
1 All references to the party Russellville Holdings, LLC, will be according to its assumed business name, St. Mary’s Regional Medical Center (St. Mary’s). 2 Dr. Johnson refiled his claims against Pope, Schumacher, and St. Mary’s in a separate case, Pope County Circuit Court case number 58CV-16-358. The circuit court dismissed the claims with prejudice, however, after ruling that the summonses failed to strictly comply with Ark. R. Civ. P. 4(b). In a companion case that we also decide today, see Johnson v. Schumacher, 2019 Ark. App. 545, 589 S.W.3d 470, we affirm the circuit court’s order dismissing the refiled complaint.
2 and hospital staff had complained that Dr. Johnson was “rude,” “arrogant,” and
“condescending” during his previous tenure in the emergency department.
Nevertheless, on January 24, 2014, Dr. Johnson and Pope executed a “Physician
Agreement” (Agreement) whereby Dr. Johnson agreed to provide physician services in the
emergency department at St. Mary’s. The Agreement became effective on February 17,
2014, and it had a one-year term that would automatically renew every year that Dr.
Johnson “worked at least one (1) clinical shift.” The Agreement also provided, however,
that Pope could terminate the contract “immediately” and “without written notice” for a
number of reasons, including when “Hospital Administration requests the removal of [Dr.
Johnson] or reports that [he] is being disruptive, unprofessional, or unreasonably
uncooperative with the medical or administrative staff of [the] Hospital.” Additionally, Dr.
Johnson would have to return a $30,000 signing bonus if he failed to meet any of the terms
and conditions of the Agreement, including his obligation to “maintain membership in good
standing on the Medical Staff of [St. Mary’s] and abide by the bylaws, rules, and regulations
of the Medical Staff[.]”
Dr. Johnson began working at St. Mary’s on March 8, 2014. A couple of months
later, Dr. McLane Simpson, the emergency room medical director for Pope and
Schumacher, learned of two incidents in which Dr. Johnson and emergency room nurses
had clashed over the use of nurse-initiated order sets, which authorized the nurses to order—
in the attending physician’s name—certain medical tests and medications according to a
3 patient’s particular complaint. 3 The order sets had not been in use during Dr. Johnson’s
previous tenure at St. Mary’s, and he believed that they allowed nurses to engage in the
unauthorized practice of medicine. Dr. Johnson also opined that the order sets resulted in
fraud because many of the tests that the nurses ordered—and the hospital billed to the
patients—were unnecessary. After discussing the issue with Dr. Johnson and hearing his
objections, Dr. Simpson ordered the nursing staff to avoid using the order sets during Dr.
Johnson’s shift in the emergency room.
On June 27, 2014, Jayme Smalley, the nurse manager in the emergency department,
learned that one of Dr. Johnson’s patients had a complaint about the care that he had been
given. The patient was suffering from an infection, and a nurse, acting according to one of
the order sets, had placed an IV. The patient told Ms. Smalley that he consequently believed
that he would be admitted to the hospital and treated with IV antibiotics. Dr. Johnson,
however, administered intramuscular injections of antibiotics and discharged the patient.
According to Ms. Smalley, the patient and his family “simply wanted an explanation,” and
if the patient ultimately was not going to be admitted into the hospital, they wanted to “talk
to the physician one more time to find out why.” Ms. Smalley responded that she would
ask Dr. Johnson to speak to the family and explain his decision.
Ms. Smalley approached Dr. Johnson while he sat in a physicians’ work area at the
nurses’ station. She explained the concerns of the patient and his family and requested that
3 To further explain, the order sets are also known as “complaint driven order sets.” One set of orders, for example, was formulated to address a male patient who is over thirty- five and presents to the emergency room with chest pain. Following the preapproved order set for such a patient, a nurse may order, among other things, a cardiac panel, an EKG, and a chest x-ray.
4 Dr. Johnson return to the patient’s room to explain his decision to give an intramuscular
injection and discharge him. According to Ms. Smalley, Dr. Johnson believed that Ms.
Smalley was questioning his medical judgment, and he refused to go explain himself to the
patient. A loud and heated argument ensued. Ms. Smalley testified in a deposition that at
one point in the altercation, Dr. Johnson got “uncomfortably close to [her],” and “pointed
his finger at [her] towards [her] sternum.” Ms. Smalley further testified that a witness to the
argument became visibly uncomfortable and that she herself felt “a little intimidated.”
Ms. Smalley immediately reported the incident to Dr. Simpson and the
administration of St. Mary’s, eventually telling Mike McCoy, the hospital’s chief operating
officer, “what [had] happened, that the patient actually . . . went home, and Dr. Johnson
never went back into the room to talk to the patient or family.” Mr. McCoy thereafter
decided that the incident with Ms. Smalley, as well as Dr. Johnson’s reputation from his
previous tenure at St. Mary’s, warranted contacting Pope and Schumacher to request that
they stop scheduling shifts for Dr. Johnson in the emergency department.
Consequently, on June 30, 2014, Mr. McCoy sent an email to Dr. Simpson stating
that the hospital administration “[did] not want Dr. Johnson working in [its] ER” because
“[t]he behavior that he displayed [with Ms. Smalley] was unacceptable.” Dr. Simpson
forwarded Mr. McCoy’s email to Schumacher’s general counsel, Ryan Domengeaux, who
determined that Mr. McCoy’s request warranted immediate termination of Dr. Johnson’s
contract.
On November 12, 2014, Dr. Johnson filed a complaint against Schumacher, Pope,
and St. Mary’s in the Circuit Court of Pope County. The complaint described the use of
5 nurse-initiated order sets in the emergency department at St. Mary’s and alleged that Dr.
Johnson “believed this practice was illegal, unethical, and fraudulent; and was placing him
in a position of condoning malpractice.” The complaint further alleged that nurses
continued using the order sets during his shift in the emergency department even after Dr.
Simpson “told the nurses verbally that Dr. Johnson does not want nurses ordering in his
name.” Dr. Johnson also alleged that his view of nurse-initiated order sets “became a
constant point of contention” with the nurses and that he “was told that he was
disruptive/disrespectful of the nurses.” He asserted that this negative atmosphere culminated
in a “hostile confrontation” with Ms. Smalley that “was about an admission of a patient to
the hospital and Dr. Johnson ‘not getting with the program.’” Dr. Johnson finally alleged
that he was terminated shortly after the incident with Ms. Smalley even though he had
contacted Dr. Simpson to resolve the issue and was “wholeheartedly in favor of repairing
nursing relationships and resolving his concerns.”
Based on those alleged facts, Dr. Johnson claimed that Pope and Schumacher
breached the Agreement “by terminating the contract based on [his] refusal to violate the
law” or, alternatively, that Pope and Schumacher wrongfully terminated him “because of
[his] refusal to violate the public policy of the State of Arkansas” as codified at Arkansas
Code Annotated sections 17-95-202(3)(A)–(B) and 17-95-401 (Repl. 2018). 4 Dr. Johnson
4 Arkansas Code Annotated section 17-95-202(3)(A)–(B) defines “office-based surgery” as “surgery that is performed by a physician in a medical office . . . that requires the use of general or intravenous anesthetics[.]” Section 17-95-401 generally provides that any person who practices medicine must have a valid license to do so.
6 further claimed that St. Mary’s tortiously interfered with his contractual relationship with
Pope and Schumacher based on his “refusal to violate the law.”
Pope filed a counterclaim against Dr. Johnson alleging that it had paid him a $30,000
signing bonus pursuant to the terms of the Agreement. Pope also alleged that the Agreement
“provided that the entire signing bonus sum of $30,000 paid to [Dr. Johnson] shall be
forfeited and returned to Pope Emergency Group within thirty (30) days of his last shift
worked, if the terms and conditions of the [Agreement] are not complied with at any time
during the commitment term.” According to Pope, Dr. Johnson stopped providing services
at St. Mary’s on July 1, 2014, and “all of his physician hospital privileges were revoked.” As
a result, “[Dr. Johnson] was in breach of contract and was required to return the signing
bonus.” He did not; and Pope alleged unjust enrichment and conversion based on Dr.
Johnson’s failure to return the signing bonus as he had agreed.
Pope, Schumacher, and St. Mary’s filed motions for summary judgment, whereupon
Dr. Johnson voluntarily nonsuited his claims. Pope nonetheless elected to proceed with its
counterclaim against Dr. Johnson, alleging that it was entitled to summary judgment because
the undisputed facts demonstrated that “Dr. Johnson breached the Agreement by failing to
return the $30,000 signing bonus within 30 days.” The circuit court agreed and granted
summary judgment on the counterclaim in an order entered on February 2, 2017.
Dr. Johnson now makes two arguments for reversal. First, while Dr. Johnson
acknowledges that he did not return the $30,000 signing bonus, he argues that he produced
“substantial evidence” that Pope was the first to breach the Agreement by wrongfully
terminating him in violation of public policy. According to Dr. Johnson, Pope terminated
7 his contract because he objected to St. Mary’s use of nurse-initiated order sets in a manner
that violated public policy against the unlicensed practice of medicine. Second, Dr. Johnson
argues that the circuit court erred by granting the motion for summary judgment because
Pope failed to show the absence of a genuine issue of material fact regarding his affirmative
defense of fraud in the inducement.
II. Standard of Review
We determine if summary judgment was appropriate after considering “whether the
evidentiary items presented by the moving party in support of the motion leave a material
question of fact unanswered.” E.g., Madden v. Mercedes-Benz USA, Inc., 2016 Ark. App. 45,
at 4, 481 S.W.3d 455, 458. “Once the moving party has established prima facie entitlement
to summary judgment by affidavits, depositions, or other supporting documents, the
opposing party must meet proof with proof and demonstrate the existence of a material issue
of fact.” Id. “The court views the evidence in the light most favorable to the party against
whom the motion was filed, resolving all doubts and inferences against the moving party.”
Id. “A court may grant summary judgment,” moreover, only when it is clear that there are
no genuine issues of material fact to be litigated and that the party is entitled to judgment as
a matter of law.” Id.
III. Discussion
A. Wrongful Termination
Dr. Johnson first argues that the circuit court erred by granting summary judgment
because he demonstrated genuine issues of material fact in his defense that Pope wrongfully
discharged him in violation of public policy. While Dr. Johnson concedes that cognizable
8 wrongful-discharge claims have been limited to at-will employees, he argues that “there is
no reason” that the doctrine should not be extended to independent contractors like himself.
He further contends that he put forth evidence that created genuine issues of material fact
regarding whether St. Mary’s use of nurse-initiated order sets violated an established public
policy in Arkansas.
Pope responds that the circuit court correctly ruled, as a matter of law, that Dr.
Johnson cannot claim that he was wrongfully discharged. Pope asserts that wrongful-
discharge claims have been limited to at-will employees in Arkansas, and it is undisputed
that Dr. Johnson was “not an at-will employee, or even an employee of any sort[.]” Pope
also asserts that even if this court were to extend wrongful-discharge claims to independent
contractors like Dr. Johnson, he failed to establish that St. Mary’s use of nurse-initiated order
sets violated a well-established public policy. Finally, Pope asserts that in any event, Dr.
Johnson failed to demonstrate that he was terminated because of his objections to the nurse-
initiated order sets.
“This court has repeatedly held that when an employee’s contract of employment is
for an indefinite term, either party may terminate the relationship without cause or at will.”
Tripcony v. Ark. Sch. for the Deaf, 2012 Ark. 188, at 9, 403 S.W.3d 559, 563. An at-will
employee may have a cause of action for wrongful discharge, however, if he or she is fired
in violation of a well-established public policy of the state. See Sterling Drug, Inc. v. Oxford,
294 Ark. 239, 248–49, 743 S.W.2d 380, 385 (1988). This public-policy exception “sounds
in contract” because “a public policy discharge action is essentially predicated on the breach
9 of an implied provision that an employer will not discharge an employee for an act done in
the public interest.” Id. at 249, 743 S.W.2d at 385.
Nevertheless, as Dr. Johnson admitted in his deposition below and appears to
concede in his brief here, he is not an at-will employee. Indeed, the Agreement is very clear
about the nature of his relationship with Pope, providing that it “shall be that of an
independent contractor” in which Pope “shall not exercise any control or direction over
the methods by which [Dr. Johnson] shall perform [his] professional work and duties while
on duty.” The Agreement further provides that it “shall not be construed as an agreement
of employment,” and correspondingly, Pope had “no responsibility for withholding any
sums for payroll taxes, FICA, or any other such employee related benefits or statutory
requirements.” Rather, Dr. Johnson agreed that as an independent contractor, it was his
“sole responsibility to provide for tax liabilities or other statutory obligations,” including
“his own worker’s compensation insurance [and] disability insurance.” Accordingly, Dr.
Johnson cannot avail himself of a wrongful-termination claim that to date has been reserved
for at-will employees.
We need not decide, moreover, whether claims of wrongful termination based on
violations of public policy should be extended to independent contractors like Dr. Johnson.
This court will not consider an argument when it is not apparent without further research
that the argument is well taken, Beth’s Bail Bonds, Inc. v. State, 2016 Ark. App. 171, at 3,
486 S.W.3d 240, 241, and Dr. Johnson does not make a sufficient argument on this complex
10 issue of first impression. 5 Dr. Johnson’s principal brief asserts only that “there is no reason”
that the doctrine should be limited to at-will employees, and his reply brief does little more,
simply asserting that the contract rationale for the exception recognized for at-will
employees in Sterling Drug should extend to all contracts. Moreover, he makes the argument
for the first time on appeal. Therefore, because we have “long held that we will not consider
an argument when the appellant presents no applicable authority or convincing argument
in its support,” Steele v. Lyon, 2015 Ark. App. 251, at 5, 460 S.W.3d 827, 832, or any
argument when it is raised for the first time on appeal, see Pleasant v. State ex rel. McDaniel,
2019 Ark. App. 248, at 6, 576 S.W.3d 90, 94, we decline Dr. Johnson’s apparent invitation
to extend Sterling Drug to independent contractors.
Even so, Dr. Johnson has not established that St. Mary’s use of nurse-initiated order
sets violates public policy. To succeed on a claim of wrongful termination, Dr. Johnson
would have to demonstrate that he was terminated in violation of an established public
policy, which is generally found in the state’s constitution and statutes. Sterling Drug, 294
Ark. at 249–50, 743 S.W.2d at 385. Dr. Johnson does not point to any statute that
5 Indeed, the supreme court engaged in a detailed survey of out-of-state cases when it decided whether to recognize the public policy exception for at-will employees in Sterling Drug, 294 Ark. at 248–49, 743 S.W.2d at 385, and courts that have addressed whether independent contractors can claim wrongful termination in violation of public policy have considered a wide spectrum of issues, including the terms of the underlying contract. See Ostrander v. Farm Bureau Mut. Ins. Co. of Idaho, 851 P.2d 946, 949–50 (Idaho 1992) (refusing to extend the doctrine because the implied covenant of good faith and fair dealing did not apply to independent contractors); Abrahamson v. NME Hosps, 195 Cal. App. 3d 1325, 1330 (Cal. Ct. App. 1987) (independent contractor whose contract allowed “termination without cause” did not have a claim for wrongful termination). Cf. Ackerman v. State, 913 N.W.2d 610, 614–22 (Iowa 2018) (analyzing the development of the common-law claim to determine that it should be extended to contract employees).
11 addresses—or expressly prohibits—the use of nurse-initiated order sets. He also cannot
extrapolate such a policy from Arkansas Code Annotated section 17-95-401, which
generally prohibits “any person” from practicing medicine without a license. See Palmer v.
Ark. Council on Econ. Educ., 344 Ark. 461, 472, 40 S.W.3d 784, 790–91 (2001) (rejecting
argument that Fiscal Responsibility Act and general state accounting laws established a
public policy against combining public and private funds in a single account).
Finally, Dr. Johnson has failed to demonstrate that Pope terminated the Agreement
in retaliation for his objections to nurse-initiated order sets. The evidence below
conclusively demonstrated that Pope terminated the Agreement simply because St. Mary’s,
after investigating Dr. Johnson’s conduct with Ms. Smalley, requested Dr. Johnson’s
removal from the emergency department’s schedule.
In addition, there is no evidence that Dr. Johnson’s objections to nurse-initiated
order sets played any role in St. Mary’s request. Indeed, Dr. Johnson testified that he never
communicated his objections to anyone in the administration at St. Mary’s. Mr. McCoy
also testified that “[i]t would not be St. Mary’s policy or procedure to discipline or remove
a physician who was unwilling to use the nurse-initiated order sets.”
Rather, Dr. Johnson’s history of unacceptable conduct toward the staff and patients
at St. Mary’s was the reason that officials at the hospital no longer wanted him in the
emergency department. Mr. McCoy explained that Donnie Frederick, the hospital’s chief
executive officer, directed him to investigate the incident with Ms. Smalley and instructed
him that “if [Dr. Johnson’s] behavior was inappropriate like it had been in the past when he
was [at St. Mary’s], that we didn’t need him working in our ER.” Also, as indicated above,
12 Mr. McCoy testified that he determined that Dr. Johnson “was no longer going to be
working at St. Mary’s” as a result of the incident with Ms. Smalley and his conduct during
his previous tenure at the hospital. Mr. McCoy further explained that “whether or not Dr.
Johnson was right or wrong with respect to patient care,” he “did not act appropriately by
not going back and being an advocate for that patient and discussing the situation and why
he treated [the patient] the way he did.” Therefore, because the evidence demonstrates that
Pope terminated the agreement simply because St. Mary’s requested his removal, and that
request was precipitated by Dr. Johnson’s unacceptable conduct—and not his objections to
nurse-initiated order sets—we affirm the circuit court’s order.
B. Fraud in the Inducement
Dr. Johnson asserted several affirmative defenses in his answer to Pope’s
counterclaim, including fraud. At the hearing on Pope’s motion for summary judgment,
Dr. Johnson argued that there remained a genuine issue of material fact regarding whether
he was fraudulently induced to execute the Agreement by its express term providing that
Pope “shall not exercise any control or direction over the methods by which [Dr. Johnson]
shall perform [his] professional work and duties while on duty.” According to Dr. Johnson,
Pope’s agreement that he could engage in “the unfettered practice of medicine at [the]
hospital,” was fraudulent because Pope knew that St. Mary’s allowed nurses to use the order
sets to intervene in patient care.
The circuit court rejected Dr. Johnson’s argument, ruling that he did not state a
cognizable claim of fraud in the inducement because he “based [his] argument . . . on
language in the Agreement itself” rather than “on a statement made prior to the execution
13 of the Agreement.” The circuit court also ruled that “Dr. Johnson has not submitted any
proof demonstrating that he was forced to practice differently from his preferences,” and in
fact, the proof showed that “when [Dr. Johnson] complained about the nurse-initiated order
sets, the nursing staff was told not to use them when Dr. Johnson was on duty.” On appeal,
Dr. Johnson apparently asserts that the circuit court erred when it rejected this claim without
requiring Pope to come forward with evidence and argument negating his fraud claim.
We must affirm because Dr. Johnson failed to assign any error to the actual basis of
the circuit court’s ruling—that he failed to state a cognizable fraud claim. It is well settled
that we will not address the merits of an argument when other grounds supporting the
circuit court’s order go unchallenged, see Quarles v. Courtyard Gardens Health and Rehab.,
LLC, 2016 Ark. 112, at 9, 488 S.W.3d 513, 520, and Dr. Johnson does not assign any error
to the circuit court’s ruling that he failed to state a cognizable fraudulent-inducement claim.
In any event, the record below does not demonstrate that Dr. Johnson was forced to
use the nurse-initiated order sets, as he apparently claims. Dr. Simpson and Dr. Johnson
both testified, after all, that Dr. Simpson instructed the nurses to avoid using nurse-initiated
order sets while Dr. Johnson was on duty. Mr. McCoy also testified that any physician who
does not want to use the order sets “could choose not to use them, as long as they reported
[the reason] to the medical director.” The circuit court’s order, therefore, is affirmed.
IV. Conclusion
Dr. Johnson failed to demonstrate that Pope first breached the Agreement by
terminating him in retaliation for his objections to St. Mary’s use of nurse-initiated order
sets. As an independent contractor, Dr. Johnson cannot advance a wrongful-termination
14 claim that has been recognized only for at-will employees, and in any event, he failed to
establish that St. Mary’s use of the nurse-initiated order sets violated a clearly established
public policy. The evidence below also demonstrated that Pope actually terminated the
Agreement because St. Mary’s requested Dr. Johnson’s removal from the emergency
department—not because of his earlier objections to the nurse-initiated order sets. Finally,
we reject Dr. Johnson’s argument that the circuit court erred by dismissing his defense of
fraud in the inducement because he does not challenge the actual basis for the circuit court’s
ruling. The order granting summary judgment on Pope’s counterclaim, therefore, is
affirmed.
GLADWIN and KLAPPENBACH, JJ., agree.
Sutter & Gillham, P.L.L.C., by: Luther Oneal Sutter; and Baker & Schulze, by: J.G.
“Gerry” Schulze, for appellant.
Wright, Lindsey & Jennings LLP, by: Regina A. Young and Gary D. Marts, Jr., for
appellee.