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Jemsek v. North Carolina Medical Board

United States District Court, E.D. North Carolina, Western Division

February 20, 2017

JOSEPH JEMSEK, M.D., Plaintiff,
v.
NORTH CAROLINA MEDICAL BOARD, et al., Defendants.

          ORDER

          JAMES C. DEVER III Chief United States District Judge.

         On February 2, 2016, Joseph Jemsek, M.D., ("Jemsek" or "plaintiff') sued the North Carolina Medical Board ("NCMB"or "the Board") and various current and former Board members in both their individual and official capacities [D.E. 1]. On March 9, 2016, Jemsek amended his complaint [D.E. 66]. Jemsek alleges that the Board and its members (collectively, "defendants") conspired to violated the Sherman Antitrust Act, 15 U.S.C. §§ 1-7, and seeks declaratory and injunctive relief. On April 7, 2016, defendants moved to dismiss Jemsek's amended complaint under Federal Rules of Civil Procedure 12(b)(1), (b)(2), and (b)(6) [D.E. 68] and filed a supporting memorandum [D.E. 69]. On May 26, 2016, Jemsek responded in opposition [D.E. 74 & 75]. On June 13, 2016, defendants replied [D.E. 79]. As explained below, the court grants defendants' motion to dismiss.

         I.

         A.

         This case concerns various disciplinary actions the NCMB took against Joseph Jemsek, M.D. Jemsek is a physician licensed to practice medicine in North Carolina, but his license is currently inactive. Am. Compl. [D.E. 66] ¶ 32. He currently practices medicine in Washington, DC. Id.

         In 2000, Jemsek founded the Jemsek Clinic in Charlotte, North Carolina. Id. ¶ 61. He is and was at all relevant times certified by the American Board of Medical Specialties in internal medicine and infectious disease. Id. ¶ 62. In 2001, Jemsek began focusing his practice on treating individuals with persistent and chronic Lyme disease. Id. ¶¶ 65-66. In doing so, Jemsek routinely treated his Lyme-disease patients with long-term antibiotic regimens. Id. ¶ 66. The Infections Disease Society of America ("IDSA") guidelines did not recognize the efficacy of treating Lyme disease with long-term antibiotics beyond 28 days. M. ¶ 70. Jemsek, however, used the International Lyme and Associated Disease Society's ("ILDAS") guidelines, which placed no durational limit on treating Lyme disease with long-term antibiotics. Id. ¶¶ 71-72.

         Beginning in 2001, Blue Cross Blue Shield of North Carolina ("BCBSNC") reimbursed Jemsek's clinic for its use of long-term antibiotics to treat patients with chronic Lyme disease. Id. ¶ 86. Before treating Lyme-disease patients, Jemsek's staff would call BCBSNC to confirm coverage for long-term antibiotic treatment. Id. ¶ 88. "In nearly every case" BCBSNC communicated that its plans imposed no restrictions on the use of intravenous or long-term antibiotics to treat Lyme disease. IcL Rather, BCBSNC relied upon the general paradigm of "medical necessity" to determine on a case-by-case basis which claims to accept or reject. Id. ¶ 87.

         In 2003, BCBSNC began examining Jemsek's claims regarding the use of long-term antibiotic therapy for Lyme-disease sufferers. Id. ¶ 90. In doing so, BCBSNC applied a Blue Cross Blue Shield Association policy that defined all courses of antibiotics lasting longer than 28 days to be "medically unnecessary" for treating Lyme disease. Id. ¶¶ 91-92. BCBSNC never informed Jemsek that it used this specific policy to deny Jemsek's patients' claims. Id. ¶¶ 91, 93. Instead, BCBSNC told Jemsek's patients that Jemsek's use of long-term antibiotics did not meet the general "medical necessity" standard. Id. ¶ 94.

         In 2005, BCBSNC circulated an internal memo listing Jemsek as one of the top 25 providers in the Charlotte area to which BCBSNC paid the greatest volume in claims. Id. ¶¶ 96-97. Later in 2005, BCBSNC stopped paying Jemsek's patients' claims for long-term antibiotic use in treating Lyme disease. Id. ¶ 99. For the first time, Jemsek learned that BCBSNC would not reimburse claims for antibiotic treatment of Lyme disease beyond 28 days. Id. Jemsek alleges that, in taking these actions, BCBSNC enlisted defendants' help in order to put Jemsek out of business by fixing the pricing of Lyme-disease treatment, forming a monopoly in favor of physicians whom BCBSNC agreed to reimburse, and allocating market share for Lyme-disease patients to physicians providing less-expensive services. Id. ¶¶ 102-03.

         Also in 2005, around the same time BCBSNC notified Jemsek of its policy toward long-term antibiotic treatment of Lyme-disease patients, some of Jemsek's patients lodged complaints with the NCMB regarding Jemsek's treatment of their Lyme disease with long-term antibiotics. Id. ¶¶ 121-22. The patients participated in BCBSNC plans. Id. Jemsek alleges that former NCMB members solicited, generated, or staged the complaints. Id. ¶¶ 107, 109, 121. In response to the complaints, the NCMB investigated Jemsek's practice and asked him to answer questions regarding the patients' complaints. Id. ¶¶ 107, 109, 128. Specifically, the investigation concerned itself with Jemsek's use of long-term antibiotics in treating Lyme-disease patients. Id. ¶¶ 128, 131, 134.

         In December 2005, the NCMB recommended charging Jemsek with professional misconduct for improperly diagnosing Lyme disease and improperly using long-term antibiotics to treat Lyme disease. Id. ¶¶ 139-40. After the charges against Jemsek were made public, BCBSNC relied on the formal charges to place a hold on all claims of Jemsek and his clinic. Id. ¶ 141. BCBSNC also ordered a review of all pending claims dating to October 2005 and stated that it would not pay such claims. Id. ¶ 141.

         On March 2, 2006, BCBSNC announced a formal policy regarding Lyme disease, which became effective on May 8, 2006. Id. ¶ 143. The policy excluded antibiotic treatment of Lyme-disease patients for longer than 28 days as "medically unnecessary." Id. ¶ 145. Jemsek alleges that this action was taken in concert with the NCMB's proceedings against Jemsek as part of a conspiracy to financially benefit BCBSNC. Id.

         Jemsek's formal hearings before the NCMB began on June 14, 2006, and ended on July 20, 2006. 141149. The process culminated with the NCMB issuing a disciplinary order on August 21, 2006 (the "2006 Order"). Id., ¶¶ 149, 153; Am. Compl. Ex. A. The 2006 Order contained certain findings of fact, including that Jemsek diagnosed Lyme disease in a manner that departed from accepted and prevailing standards of medical practice; administered treatment that similarly diverged from accepted and prevailing practices, specifically his use of long-term antibiotics; failed to adequately educate and inform his patients that his method of diagnosing Lyme disease departed from recognized standards for diagnosing the disease; and failed to adequately educate and inform his patients that his use of long-term antibiotics departed from recognized standards for treating Lyme disease. See Am. Compl. Ex. A. Based on these findings, the NCMB concluded that Jemsek's diagnosis and treatment practices constituted unprofessional conduct by failing to adhere to acceptable and prevailing standards of medical practice, and Jemsek's failure to explain his methods of diagnosis and treatment violated his patients' informed consent. Id. The NCMB suspended Jemsek's medical license for twelve months, a decision it stayed pending Jemsek's adherence to certain terms and conditions. Id. These terms and conditions restricted how Jemsek could treat Lyme-disease patients and barred him from using long-term antibiotics without pre-clearance. Am. Compl. ¶¶ 149, 155; see Am. Compl. Ex. A. After the NCMB issued the 2006 Order, Jemsek continued practicing medicine in North Carolina and complied with the 2006 Order's requirements. Am. Compl. ¶ 167.

         Jemsek alleges that the NCMB and former Board members initiated the NCMB's investigative process as part of a conspiracy to restrain Jemsek's medical practice by restricting the types of treatment he could administer to Lyme-disease patients to those treatments consistent with BCBSNC's policies. Id¶¶ 124, 126, 127, 133, 137, 138-39, 154-56, 165. According to Jemsek, the 2006 Order was the "byproduct" of the conspiracy. Id., ¶ 156. Jemsek also accuses defendant Dr. Rhyne-then a Board member-of spearheading the investigation and encouraging Board members to investigate Jemsek because Dr. Rhyne consulted on BCBSNC's Lyme-disease policy. Id. ¶¶ 105, 107, 115-16, 121-24.

         In June 2007, the NCMB initiated a new investigation into Jemsek's use of hyperbaric chambers to treat Lyme-disease patients. Id. ¶ 172. The NCMB and former Board members communicated to Jemsek through his attorney that the NCMB would not pursue the new investigation or further discipline if Jemsek allowed his North Carolina medical license to lapse or become inactive. Id. ¶ 174. In response, Jemsek placed his North Carolina license on inactive status. Id. ¶ 177. Jemsek alleges that the NCMB conspired to violate the Sherman Act by offering to forego further disciplinary actions in exchange for Jemsek letting his license lapse or placing it on inactive status. Id. ¶¶ 167, 175, 177.

         On June 23, 2008, the NCMB issued a "Public Letter of Concern" (the "2008 Letter"). Id. ¶ 179; Am. Compl. Ex. B. The 2008 Letter-a public record-represented the conclusion of the NCMB's inquiry in Jemsek's use of hyperbaric chambers to treat Lyme-disease patients. See Am. Compl. Ex. B. The 2008 Letter noted that Jemsek failed to supervise his nurse practitioners consistent with regulations, used a form of treatment "non-indicated for Lyme disease, " and did so after being ordered to stop using long-term antibiotics, which the NCMB had also found to fall below acceptable and prevailing standards of medical practice. See id. Jemsek alleges that defendants' aim in issuing the 2008 Letter was to restrain trade and prevent Jemsek from practicing medicine in North Carolina and elsewhere. Am. Compl. ¶¶ 180-82, 190.

         B.

         On September 9, 2014, Jemsek sued the NCMB and some of its current and former Board members alleging that in issuing the 2006 Order and 2008 Letter defendants violated his right to due process under the United States Constitution. See Jemsek v. State of North Carolina. (Jemsek I) No. 5:14-CV-504-BO, (E.D. N.C. Sep. 9, 2014) [D.E. 1]. He sought a declaration that the NCMB's 2006 Order and 2008 Letter were null, void, and unconstitutional, and a mandatory injunction directing the current Board members to rescind the 2006 Order and 2008 Letter. See UL; Order, Jemsek I. No. 5:14-CV-504-BO (E.D. N.C. Mar. 23, 2015) [D.E. 65] 7-8.

         On March 23, 2015, the Honorable Terrence W. Boyle granted defendants' motion to dismiss. The court held that the Eleventh Amendment barred Jemsek's claims against the NCMB and his official-capacity claims against the Board-member defendants. Order, Jemsek I. No. 5:14-CV-504-BO (E.D. N.C. Mar. 23, 2015) [D.E. 65] 6-9. In doing so, the court explained that the relief sought was "clearly retrospective" because the claim for declaratory relief "addresse[d] alleged wrongs that occurred entirely in the past, " and the claim for injunctive relief "relate[d] only to the consequences of actions in the past." Id. As for Jemsek's individual-capacity claims against the former Board members, the court observed that Jemsek lacked standing to pursue those claims against the former Board members because a favorable judgment would not redress his alleged harms. Id. at 8-9. As the court stated: "the past board members would have no authority to comply with an injunction and a declaratory judgment would have no legal effect on these individuals." Id. at 9.

         Jemsek appealed. On October 13, 2016, the Fourth Circuit affirmed the dismissal. Jemsek v. Rhvne. (Jemsek I Appeal), No. 15-1420, 2016 WL ...


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