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Philips v. Pitt County Mem. Hosp.

United States Court of Appeals for the Fourth Circuit

October 29, 2008, Argued; July 13, 2009, Decided

No. 07-1986, No. 07-1996

Opinion

 [*177]  COPENHAVER, District Judge:

Dr. Sherif A. Philips instituted two civil actions challenging the suspension of his practice privileges at Pitt County Memorial Hospital ("the Hospital").  [**2] In addition to supplemental state law claims, he alleged violations of 42 U.S.C. § 1983 based upon putative infringements of his Fourteenth Amendment due process rights surrounding the proceedings that resulted in  [*178]  his suspension. He contends that Pitt County Memorial Hospital, Inc. ("PCMHI"), a nonprofit corporation, is a state actor.

The defendants moved to dismiss both actions. They contended principally that Dr. Philips could not show they acted under color of state law. The district court agreed and Dr. Philips appeals. We affirm.

From 1953 until June 1998, Pitt County owned all of the property representing the Hospital, which it apparently leased to PCMHI, a non-profit formed in 1953 under the general nonprofit incorporation laws of North Carolina. On June 1, 1998, at a time when PCMHI was operating the Hospital under a long term lease from Pitt County dated December 1, 1989, Pitt County and PCMHI entered into an "AGREEMENT TO CHANGE STATUS OF PITT COUNTY MEMORIAL HOSPITAL" ("Agreement"). (JA 47).

The Agreement was designed "to change the status of . . . . [Pitt County Memorial Hospital] from a Public Hospital to a Private Not For Profit Hospital" pursuant to the Municipal Hospital  [**3] Act, North Carolina General Statutes § 131E-8 ("Act"). (Id.) Accompanying the change over was the filing by PCMHI with the North Carolina Secretary of State on September 18, 1998, of Restated Articles of Incorporation ("Restated Articles"), submitted for the purpose, in part, of reflecting PCMHI's "reorganization from an agency of Pitt County to a private not-for-profit corporation." 2 

The change was accomplished by the sale of the Hospital to PCMHI, at a price of $ 30 million spread over two years. The Agreement includes further terms indicative of some measure of retained control by Pitt County over its former agency, PCMHI:

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572 F.3d 176 *; 2009 U.S. App. LEXIS 15385 **; 29 I.E.R. Cas. (BNA) 959

SHERIF PHILIPS, M.D., Plaintiff-Appellant, v. PITT COUNTY MEMORIAL HOSPITAL; PAUL BOLIN, M.D.; RALPH E. WHATLEY, M.D., Defendants-Appellees. SHERIF PHILIPS, M.D., Plaintiff-Appellant, v. PITT COUNTY MEMORIAL HOSPITAL; SANJAY PATEL, M.D.; PAUL BOLIN, M.D.; RALPH E. WHATLEY, M.D.; CYNTHIA BROWN, M.D., Defendants-Appellees.

Prior History:  [**1] Appeals from the United States District Court for the Eastern District of North Carolina, at Greenville. James C. Fox, Senior District Judge. (4:07-cv-00049-F; 4:05-cv-00097-F).

Philips v. Pitt County Mem. Hosp., 503 F. Supp. 2d 785, 2007 U.S. Dist. LEXIS 62401 (E.D.N.C., 2007)Philips v. Pitt County Mem. Hosp., Inc., 503 F. Supp. 2d 776, 2007 U.S. Dist. LEXIS 62402 (E.D.N.C., 2007)

Disposition: AFFIRMED.

CORE TERMS

state action, privileges, nexus, appointed, nonprofit, entity, member of the board, deprivation, district court, suspension, rights, state actor, color

Civil Rights Law, Elements, Color of State Law, General Overview, Civil Procedure, Defenses, Demurrers & Objections, Motions to Dismiss, Failure to State Claim, Appeals, Reviewability of Lower Court Decisions, Standards of Review, Protection of Rights, Section 1983 Actions, Scope