In Re Methodist Healthcare System of San Antonio, LTD., LLP v. the State of Texas

CourtCourt of Appeals of Texas
DecidedNovember 27, 2024
Docket04-24-00056-CV
StatusPublished

This text of In Re Methodist Healthcare System of San Antonio, LTD., LLP v. the State of Texas (In Re Methodist Healthcare System of San Antonio, LTD., LLP v. the State of Texas) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In Re Methodist Healthcare System of San Antonio, LTD., LLP v. the State of Texas, (Tex. Ct. App. 2024).

Opinion

Fourth Court of Appeals San Antonio, Texas MEMORANDUM OPINION

No. 04-24-00056-CV

IN RE METHODIST HEALTHCARE SYSTEM OF SAN ANTONIO, LTD., LLP, Relator

Original Proceeding 1

Opinion by: Irene Rios, Justice

Sitting: Rebeca C. Martinez, Chief Justice Irene Rios, Justice Lori I. Valenzuela, Justice

Delivered and Filed: November 27, 2024

PETITION FOR WRIT OF MANDAMUS CONDITIONALLY GRANTED

In this original proceeding, relator Methodist Healthcare System of San Antonio, Ltd., LLP

(“Methodist”) asserts the trial court abused its discretion by ordering it to produce documents

protected under the medical peer review privilege. We agree and conditionally grant mandamus

relief.

BACKGROUND

In the underlying matter, real party in interest, J. Marvin Smith III, M.D. (“Dr. Smith”), a

cardiothoracic surgeon, asserts that Methodist undertook a smear campaign against him in reaction

to Dr. Smith’s opposition to a new hospital policy requiring Methodist-employed physicians to

1 This proceeding arises out of Cause No. 2020-CI-18056, styled J. Marvin Smith III, M.D. v. Methodist Healthcare System of San Antonio, Ltd., LLP, pending in the 150th Judicial District Court, Bexar County, Texas, the Honorable Rosie Alvarado presiding. 04-24-00056-CV

prescribe consultations with its in-house intensivists and other heart specialists. 2 Dr. Smith asserts

Methodist initially sought to force his compliance with this new policy but later sought to force

him out of practice—purportedly so that he could not compete against Methodist’s in-house

cardiothoracic surgeons.

Dr. Smith asserts that Methodist pursued those goals by: 1) disseminating flawed mortality

rate information relating to surgeries he had performed; 2) instructing referring physicians to refer

their patients to Methodist’s in-house cardiothoracic surgeons rather than Dr. Smith; 3) refusing

to confirm the status of his privileges at Methodist (which caused the loss of privileges at Baptist

Health System hospitals); 4) undertaking a malicious “sham” medical peer review process; and 5)

relying upon an “inaccurate” competency assessment finding Dr. Smith was not fully competent

to practice medicine.

Dr. Smith filed suit against Methodist on September 18, 2020, asserting Methodist’s

actions smeared his reputation, caused his loss of privileges at other hospitals, and prevented him

from earning any income.

Shortly after filing suit, Dr. Smith propounded discovery requests seeking documents and

testimony that Methodist objected to on various grounds including an assertion of the medical peer

review privilege. On November 25, 2020, Methodist filed a motion for a protective order asserting

some of the discovery sought by Dr. Smith was protected from disclosure under the medical peer

review privilege. On January 19, 2022, the trial court granted the motion for protective order in

part, holding that “all documents produced for in camera inspection, except communications

directly from Dr. Smith and his attorney to the Peer Review Committee (the “Committee”), shall

be protected as privileged and not subject to disclosure.”

2 Dr. Smith’s allegations are taken from his March 18, 2024 Second Amended Original Petition, the live petition when the trial court made the discovery ruling at issue in this original proceeding. -2- 04-24-00056-CV

On September 22, 2022, Dr. Smith filed a motion to reconsider the order protecting certain

documents from disclosure under the medical peer review privilege and a motion to compel

discovery responses and deposition testimony. On March 14, 2023, Dr. Smith filed a supplement

to these motions. On January 16, 2024, the trial court granted Dr. Smith’s supplemental motion

for reconsideration and motion to compel, finding that the anticompetitive exception to the medical

peer review privilege applies.

On January 24, 2024, Methodist filed its original petition for writ of mandamus and a

motion for emergency temporary relief. Two days later, the trial court amended its order, instead

requiring Methodist to provide the documents at issue to the court for in camera inspection rather

than producing them directly to Dr. Smith. On March 25, 2024, the trial court ruled that the

anticompetitive exception to the medical peer review privilege applied to all but one of the

documents provided for in camera inspection.

On April 4, 2024, Methodist filed an amended petition for writ of mandamus, asserting that

the anticompetitive exception does not apply to any of the documents at issue because Dr. Smith’s

allegations do not establish the exception.

REQUIREMENTS FOR GRANTING A WRIT OF MANDAMUS

Mandamus is an extraordinary remedy that will issue only to correct a clear abuse of

discretion when the relator has no adequate remedy by appeal. In re Sw. Bell Tel. Co., L.P.,

235 S.W.3d 619, 623 (Tex. 2007) (orig. proceeding). A relator has no adequate remedy by appeal

when the denial of mandamus relief would result in an “irreversible waste of judicial and public

resources[.]” In re Prudential Ins. Co. of Am., 148 S.W.3d 124, 136–37 (Tex. 2004) (orig.

proceeding) (quoting In re Masonite Corp., 997 S.W.2d 194, 198 (Tex. 1999) (orig. proceeding)).

Mandamus is appropriate to review a trial court’s pre-trial discovery orders. In re Aguilar,

No. 04-13-00425-CV, 2013 WL 4501435, at *2 (Tex. App.—San Antonio Aug. 21, 2013, orig.

-3- 04-24-00056-CV

proceeding) (mem. op.) (citing Walker v. Packer, 827 S.W.2d 833, 842 (Tex. 1992) (orig.

proceeding)); see also In re Christus Santa Rosa Health Sys., 492 S.W.3d 276, 279 (Tex. 2016)

(orig. proceeding) (“We have long held that ‘a party will not have an adequate remedy by appeal

when the appellate court would not be able to cure the trial court’s discovery error.’”) (quoting

Walker, 827 S.W.2d at 843). “Mandamus is proper when the trial court erroneously orders the

disclosure of privileged information because the trial court’s error cannot be corrected on appeal.”

In re Mem’l Hermann Hosp. Sys., 464 S.W.3d 686, 697–98 (Tex. 2015) (orig. proceeding).

“Whether a discovery privilege applies is a matter of statutory construction.” Christus

Santa Rosa, 492 S.W.3d at 280. “Statutory construction is a question of law we review de novo.”

Mem’l Hermann Hosp., 464 S.W.3d at 700. “When construing a statute, we look to the plain

language to determine the intent of the [l]egislature.” Christus Santa Rosa, 492 S.W.3d at 280. “If

the statute is unambiguous, we apply the words according to their common meaning, but we may

consider the objective of the law and the consequences of a particular construction.” Id. “If the

documents at issue are alleged to be privileged, ‘mandamus is appropriate if we conclude that they

are privileged and have been improperly ordered disclosed.’” Christus Santa Rosa, 492 S.W.3d at

279 (quoting In re Living Ctrs.

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In Re Methodist Healthcare System of San Antonio, LTD., LLP v. the State of Texas, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-methodist-healthcare-system-of-san-antonio-ltd-llp-v-the-state-of-texapp-2024.