NABP Legal Briefs: Certifican't Can

October 28, 2011 5:31 pm

Originally published in the October 2011 NABP Newsletter

By Dale J. Atkinson, JD

Boards of pharmacy rely upon NABP for expertise and uniformity in the development, implementation, administration, and maintenance of programs designed to assist such member boards in regulating the practice of pharmacy in the interest of public protection. Security in high stakes licensure examinations is paramount and NABP goes to great lengths to protect the integrity of all of its exam programs. Numerous NABP-like associations and federations are currently addressing or have been recently affected by examination breaches causing an unprecedented dedication of resources to uncover the breaches, repair the damage, and pursue legal recourse against the infringing parties to ultimately protect the integrity of the examination and licensure process. In addition, certification programs, referring to voluntary, private sector bestowed recognition of specialty knowledge, are not immune from examination breaches and the significant consequences imposed upon the owner of the program(s).

Regardless of the type of assessment mechanism, examination owners will vigorously protect their respective programs and may, in addition to legal action, undertake a public relations approach to supplement already encompassing contracts with examinees in an effort to publicize the importance of exam security and deter the sharing of protected information. Such media campaign is not without its own risks. Consider the following.

In order to lawfully practice medicine, physicians must be licensed by each respective state where such practice occurs. Licensure by the state is mandatory and a prerequisite to practice. Licensees may also seek voluntary “board certification” in one of many specialties. The American Board of Internal Medicine (ABIM or plaintiff) is a private sector, not-for-profit organization that offers subspecialty certification programs, each of which involves the successful completion of an examination as one criterion for recognition. One of its certification examinations is in gastroenterology.

A candidate for certification in the subspecialty of gastroenterology had taken the specialty exam on five previous occasions. On each such test, this candidate, both before and at the conclusion of each exam administration, agreed to abide by ABIM’s policies and procedures and its Pledge of Honesty, promising not to disclose, copy, or reproduce any portion of the materials contained in the examination. Nevertheless, it is alleged that after the fifth attempt at the exam (taken in November 2008), the candidate sent 77 exam items that were substantially similar to live items used on that exam to a review course attended by the candidate prior to multiple administrations of the gastroenterology test. Also, it is alleged that the candidate purchased infringing exam questions from this review course prior to the November 2008 administration. These alleged infringing activities led ABIM to pursue litigation in Federal District Court in the Eastern District of Pennsylvania against the candidate. In its complaint, ABIM alleged that the candidate unlawfully obtained, copied, and disseminated copyrighted and/or trade secret protected exam questions and sought to obtain injunctive and monetary relief. In separate actions, ABIM also pursued litigation against at least four other alleged infringers, as well as against the review course attended by all such defendants.

In the current case, the candidate filed an answer denying the allegations to the complaint. She also asserted 11 counterclaims against the ABIM. Some of these counterclaims alleged violations of her due process rights, tortious interference with actual and prospective business relationships, commercial disparagement, defamation, false light, unfair competition, and civil conspiracy. ABIM filed motions to dismiss the referenced counterclaims, which were the subject of the recent judicial opinion. Thus, ABIM, as a plaintiff in the original suit, is considered a counter defendant and must defend itself from the counter allegations.

After identifying the standards addressed by a court relative to the motions, the court turned its attention to the counterclaims pursued by the candidate and sought to be dismissed by ABIM.

First, the candidate alleged that her ABIM board certification in gastroenterology created a valuable property right in such recognition and that the suspension of her certificate by ABIM occurred without prior notice and without an opportunity to be heard. The court surmised such counterclaim to be based upon the Fourteenth Amendment of the United States Constitution and that the candidate argued a deprivation of a property right without due process of law.

Noting that the application of due process under the Fourteenth Amendment applies to “state action” or “a person for whom the state is responsible,” the court addressed whether ABIM fits either category. As ABIM is not a state entity, the court reviewed under what circumstances an entity may “fairly be said to be a state actor,” including a public function test, a close nexus test, or a symbiotic relationship test. Unable to find facts alleged in the counterclaim that provide the necessary connection between ABIM and a state entity, including the volunteer nature of board certification, the court held that ABIM is not subject to the due process requirements of the Fourteenth Amendment and dismissed that counterclaim.

Regarding the counterclaim alleging tortious interference with business relationships, the court reviewed the elements of such an allegation which include:

1. the existence of a contract or prospective contract between the counterclaimant and a third party;
2. purposeful action on the part of the counter-defendant intending to harm the existing relationship;
3. the absence of a privilege or justification on the part of the counter-defendant; and
4. actual legal damage caused as a result.

Based upon the fact that the candidate alleged that she has suffered significant loss of income and that hospital privileges require such board certification for admitting and treatment purposes, and that plausible allegation of malicious and wanton activities of ABIM personnel exists, the court denied ABIM’s motion to dismiss this counterclaim.

The candidate also alleged via a counterclaim commercial disparagement which “compensate[s] a vendor for pecuniary loss suffered because statements attacking the quality of its goods have reduced their marketability.” Distinguishing between commercial disparagement and defamation, the court found that the candidate’s allegations, which for motions to dismiss purposes are accepted as true, are sufficiently plausible to withstand the motion. Factually, it is alleged that ABIM accused the candidate of “cheating” on her certification exam, notified the Wall Street Journal resulting in the publication of an article, disseminated the Wall Street Journal article to “many, if not all residency programs in the U.S.,” suspended her ABIM certification without notice or a right to respond to the allegations, and placed such suspension on its Web site. Based upon these allegations, the court denied the ABIM motion to dismiss this counterclaim.

Addressing the counterclaim for defamation, the court noted the necessary elements which include:

1. defamatory character of the communication;
2. publication by the counter-defendant (ABIM);
3. application of publication to the counter-plaintiff (candidate);
4. understanding by the recipient of the defamatory meaning;
5. understanding by the recipient of the application to the counter-plaintiff (candidate);
6. special harm to the counter-plaintiff (candidate); and
7. abuse of a conditionally privileged publication occasion.

In upholding the counterclaim and denying the ABIM motion to dismiss, the court noted the serious nature of accusing anyone of cheating on an exam. It also held such accusations would “unquestionably harm the reputation of and lower the accused individual in the eyes of his community and would likely deter third persons from associating or dealing with him or her.”

The candidate also alleged in her counterclaims a cause of action under false light, which is a tort involving “publicity that unreasonably places the other in a false light before the public.” Elements to establish a false light cause of action include that the false light would be highly offensive to a reasonable person and the publisher had knowledge of or acted recklessly as to the falsity of the published matter. Again, relying on the plausibility of the allegations of the candidate, the court denied the ABIM motion to dismiss this counterclaim and allowed it to proceed.

Next, the court addressed the counterclaim allegations of the candidate related to unfair competition. The candidate alleged that the actions of ABIM in accusing candidates of cheating, suspending their certification, and publishing these activities were intentional and intended to procure an unfair advantage for ABIM and those certificate holders that were not suspended. Based upon the complex elements necessary to substantiate a claim for unfair competition along with the fact that the candidate must allege she is in competition with ABIM in the supply of similar goods and services, the court granted the ABIM motion to dismiss this particular counterclaim.

Finally, the court addressed the counterclaim of the existence of a civil conspiracy whereby ABIM is alleged to have conspired with others to undertake an unlawful act (or carry out a lawful act by unlawful means) causing damage to the candidate. ABIM’s motion to dismiss stated that it cannot conspire with its own employees, thus necessitating dismissal of the claim. The court, recognizing the inability of corporate employees conspiring with one another, agreed to the dismissal, but provided the candidate with an opportunity to amend her counterclaim at her election.

Overall, several counterclaims averred by the candidate were allowed to proceed. Unless settled, there will be a trial on the merits where factual and legal conclusions will be resolved. This case presents an excellent example of how publicizing allegations of wrongdoing can lead to counterclaims and potential damages against the party initiating litigation.

American Board of Internal Medicine v Von Muller, 2011 WL 857337 (US District Ct PA 2011)