Sherry Spade v. Appalachian Regional Healthcare, Inc.

CourtDistrict Court, E.D. Kentucky
DecidedMarch 11, 2026
Docket6:24-cv-00129
StatusUnknown

This text of Sherry Spade v. Appalachian Regional Healthcare, Inc. (Sherry Spade v. Appalachian Regional Healthcare, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sherry Spade v. Appalachian Regional Healthcare, Inc., (E.D. Ky. 2026).

Opinion

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF KENTUCKY SOUTHERN DIVISION AT LONDON

SHERRY SPADE CASE NO. 6:24-CV-129-KKC Plaintiff, v. OPINION and ORDER APPALACHIAN REGIONAL HEALTHCARE, INC., Defendant. *** *** *** This matter comes before the Court on Defendant Appalachian Regional Healthcare, Inc.’s (“ARH”) Motion for Summary Judgment (R. 25). Now that this matter is fully briefed, it is ready for review. For the following reasons, ARH’s Motion is GRANTED. I. FACTUAL BACKGROUND This case concerns the employment and eventual termination of Plaintiff Sherry Spade. In August 2013, Spade was hired by ARH at their Middlesboro, Kentucky medical facility. (R. 27 at 2.) At the beginning of her employment, Spade received training on ARH’s policies. (R. 25-9 at 2.) These policies included HIPAA compliance policies, code of conduct, guidelines for conduct, and confidentiality policy. (Id.) On August 12, 2013, Spade signed the “Acknowledgement and certification – CCRAO section of Orientation” which confirmed that she “attended an orientation session that included HIPPA [sic], ARH Compliance program, and ARH Standards of Conduct.” (R. 25-1 at 2.) She further acknowledged that compliance with ARH policy was a condition of her employment. (Id.) Under ARH’s HIPAA policy, Spade was not to “use or disclose protected health information unless such use or disclosure is either permitted or required by HIPAA.” (R. 25-9 at 3.) As a condition of her employment, Spade was also required to complete annual trainings which included HIPAA compliance training. (R. 28 at 2.) Lisa Dray, Spade’s immediate supervisor, and Melissa Barnes, the Human Resources Manager, both confirmed that Spade completed her annual trainings. (Id.) ARH provides evidence of Spade’s singed “Policy Acknowledge [sic] and Acceptance” dated January 6, 2020. (R. 25-2 at 2.) By its own terms, that acknowledgment confirms that Spade was aware of the content, requirements, and expectations of ARH’s policies. (Id.) In 2022, Spade was promoted to Financial Counselor at Middlesboro ARH. (R. 27 at

2.) Spade received high remarks on her 2022 performance evaluation and was never disciplined prior to her termination. (Id.) In fact, Dray noted on Spade’s performance evaluation that Spade is an “Amazing Employee” and that she was “Blessed to have Sherry on my team!!” (Id.) In February 2023, Spade sustained a foot injury after falling at work. (Id.) As a result, she filed a workers’ compensation claim as she had to miss work for several months. (Id.) This was not the only time that Spade had to take leave; in 2021 she filed a workers’ compensation claim for a different injury. (R. 25-9 at 2.) Spade did not return to work until June 26, 2023. (Id.) During her time off, Spade’s job was held open for her, and no one was hired in her place. (R. 25-9 at 4.) When Spade returned to work, she was still recovering from the injury. (R. 27 at 3.) This caused her to miss work on August 4, 10, 11, and 14, 2023, for continued medical treatment. (Id.) On July 28, 2023, just over a month after Spade had returned to work, a 17-month- old toddler was brought to Middlesboro ARH with significant injuries allegedly from severe abuse. (R. 27 at 4.) Unfortunately, the toddler died from his injuries. (Id.) Shortly after the toddler died, someone told ARH that sensitive information from the toddler’s medical records had been leaked onto Facebook. (Id.) ARH conducted an audit to see who accessed the toddler’s records. (Id.) The audit revealed that dozens of employees accessed the toddler’s records between July 28, 2023, and August 3, 2023. (Id.) ARH then questioned 13 individuals including Spade to consider whether they had a valid reason for accessing the toddler’s medical chart. (Id.) Spade admits she had no legitimate business reason for viewing the records and maintains that she only opened his file to pray over them. (Id.) ARH then held a meeting with members of its corporate and legal team in which it

decided that 11 individuals would be disciplined for unauthorized access of the toddler’s medical records, which was a violation of HIPAA and company policy. (Id. at 5.) On August 15, 2023, Spade was called into a meeting with ARH supervisors Barnes, Dray, and Corey Eldridge. (Id.) Spade was informed that she was being suspended for five days with the intent to terminate her. (Id.) Spade was subsequently terminated on August 23, 2023. (Id.) ARH’s stated reason for the termination was violation of HIPAA and ARH policy. (Id.) Of the 11 individuals who were disciplined, only Spade and two others were terminated. (Id.) The remaining employees received either a three-day suspension or a five- day suspension accompanied by a last-chance agreement. (Id.) On August 16, 2024, Spade filed the present matter in Bell County Circuit Court asserting claims under KRS § 342.197 and for retaliation under the Family Medical Leave Act, 29 U.S.C. 2601, et seq., (“FMLA”). (R. 1-1.) ARH removed the matter to this Court on September 9, 2024. (R. 1-5.) Upon the close of discovery, ARH filed the present motion for summary judgment. (R. 25.) II. LEGAL STANDARD Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). The moving party bears the initial burden and must identify "those portions of the [record] which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986) (citation and quotation marks omitted). All evidence, facts, and inferences must be viewed in favor of the nonmoving party. See McLean v. 988011 Ontario, Ltd., 224 F.3d 797, 800 (6th Cir. 2000). "In order to defeat a summary judgment motion, . . . [t]he nonmoving party must provide more than a scintilla of evidence," or, in other words, "sufficient evidence to permit a reasonable jury to find in that party's favor." Van Gorder v. Grand Trunk W. R.R., Inc., 509 F.3d 265, 268 (6th Cir. 2007)

(citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986)). III. ANALYSIS ARH moves for summary judgment arguing that its termination of Spade did not violate the FMLA or KRS § 342.197 because she was fired for a legitimate business reason. (R. 25-9 at 1.) In response, Spade argues that ARH’s proffered reason for termination was pretextual. (R. 27 at 10.) A. FMLA interference Count II of Spade’s Complaint is listed as “FMLA RETALIATION/INTERFERENCE.” (R. 1 at 5.) The Sixth Circuit recognizes "two discrete theories of recovery under the FMLA: (1) the so-called 'interference' or 'entitlement' theory arising from § 2615(a)(1), and (2) the 'retaliation' or 'discrimination' theory arising from § 2615(a)(2)." Seeger v. Cincinnati Bell Tel. Co., LLC, 681 F.3d 274, 282 (6th Cir. 2012). An interference claim arises when an employer hinders an employee’s right to take leave, while a retaliation claim relates to an employer’s discrimination of an employee who took leave. Id.; compare § 2615(a)(1), with § 2615(a)(2).

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Sherry Spade v. Appalachian Regional Healthcare, Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/sherry-spade-v-appalachian-regional-healthcare-inc-kyed-2026.