PACIFIC RADIATION ONCOLOGY, LLC, a Hawai’i limited liability corporation v. THE QUEEN’S MEDICAL CENTER, a Hawai’i non-profit corporation

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
PACIFIC RADIATION ONCOLOGY,
LLC, a Hawai’i limited liability
corporation; PRO ASSOCIATES, LLC, a
Hawai’i limited liability company; JOHN
LEDERER, M.D., individually and as
manager of the LLC’s appearing for the
Pacific Radiation Oncology Physicians;
LAETON PANG, M.D.; EVA BIENIEK,
M.D.; VINCENT BROWN, M.D.; PAUL
DEMARE, M.D.; THANH HUYNH,
M.D.,
Plaintiffs - Appellees,
v.
THE QUEEN’S MEDICAL CENTER, a
Hawai’i non-profit corporation; QUEEN’S
DEVELOPMENT CORP., a Hawai’i for
profit corporation; NOREEN D.S.W.
MOKUAU; WILLIAM G. OBANA,
M.D.; ARTHUR A. USHIJIMA; MARK
H. YAMAKAWA; PAULA YOSHIOKA;
SHARLENE K. TSUDA; RICHARD C.
KEENE; CLINTON YEE; NALEEN M.
ANDRADE, M.D.; ERNEST H.
FUKEDA, Jr.; ROBB OHTANI, M.D.;
NEIL J. HANNAHS; CHRISTINE M.
No. 12-15624
D.C. No. 1:12-cv-00064-LEK-
KSC
MEMORANDUM*
FILED
FEB 24 2014
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
* This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.

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GAYAGAS; PETER K. HANASHIRO;
ROBERT K. NOBRIGA; ERIC K.
YEAMAN; JULIA C. WO; CAROLINE
WARD ODA; PETER HALFORD, M.D.;
BARRY WEINMAN, individually and in
their capacities as Officers and Trustees of
Queen’s Medical Center,
Defendants - Appellants.
Appeal from the United States District Court
for the District of Hawaii
Leslie E. Kobayashi, District Judge, Presiding
Argued and Submitted October 15, 2012
Honolulu, Hawaii
Before: REINHARDT, THOMAS, and PAEZ, Circuit Judges.
The plaintiffs in this case are a group of radiation oncologists who had their
privileges to perform certain medical procedures at the Queen’s Medical Center
revoked when the Medical Center decided to move to an employment-based
model, permitting only employees to use its radiation oncology facilities. The
Medical Center appeals the district court’s order granting a partial preliminary
injunction that permits plaintiff Dr. John Lederer, M.D. to perform certain
procedures at the Medical Center’s facilities. We affirm.
Federal jurisdiction exists because plaintiffs allege a Fourteenth Amendment
claim against the Medical Center. Although it is uncertain whether the Medical
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Center qualifies as a state actor for purposes of this claim, the question is not “so
insubstantial, implausible, foreclosed by prior decisions of this Court, or otherwise
completely devoid of merit as not to involve a federal controversy.” Oneida
Indian Nation of N.Y. v. Cnty. of Oneida, 414 U.S. 661, 666 (1974).
The district court did not abuse its discretion in granting a partial
preliminary injunction. See Pimentel v. Dreyfus, 670 F.3d 1096, 1105 (9th Cir.
2012) (stating that review of a district court’s grant of a preliminary injunction is
for abuse of discretion). Under the governing Winter standard, plaintiffs must
show that they are “likely to succeed on the merits, that [they are] likely to suffer
irreparable harm in the absence of preliminary relief, that the balance of equities
tips in [their] favor, and that an injunction is in the public interest.” Winter v.
Natural Res. Def. Council, Inc., 555 U.S. 7, 20 (2008).
The district court correctly determined that plaintiffs were likely to succeed
on their due process claim under Silver v. Castle Memorial Hospital, 497 P.2d 564
(Haw. 1972).1 Silver explained that a private hospital’s decision to refuse to extend
staff privileges to a licensed doctor without proper procedural due process could
1 Because we conclude that the district court did not abuse its discretion by
finding a likelihood of success on plaintiffs’ due process claim under the state
constitution, we need not reach its ruling that plaintiffs are also likely to succeed
on their unfair competition claim.
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violate the Hawaii Constitution if that hospital were “quasi-public.” Id. at 569-70.
A private hospital is “quasi-public” if it receives “more than nominal governmental
involvement in the form of funding.” Id. at 570. We take judicial notice of the fact
that Hawaii has appropriated the Medical Center $1.5 million to operate an organ
transplant center. Based on the government funding as well as the hospital’s
historical ties to the state, see Hite v. The Queen’s Hospital, 36 Haw. 250 (1942), it
is likely that plaintiffs will succeed on their claim that the Medical Center qualifies
as “quasi-public.” Moreover, the district court pointed to evidence that the
Medical Center based its decision to revoke plaintiffs’ privileges, at least in part,
on “concerns about the PRO physicians’ competence or qualifications.” The
revocation of privileges on the basis of “professional competence or conduct”
triggers due process rights under the Medical Center’s bylaws, and, thus, plaintiffs
are likely to succeed on their claim for denial of due process under Silver.
Turning to irreparable harm, the district court did not abuse its discretion by
finding that Lederer is likely to suffer irreparable harm as to two groups of patients
who would not be able to receive certain needed procedures under Lederer’s care
unless he could continue to exercise privileges at the Medical Center. The district
court found that without a preliminary injunction, Lederer would suffer irreparable
harm to relationships with patients and referring physicians will be “deprived of
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the opportunity to compete for [] potential patients” and “will lose competitive
ground in the industry.” These harms are irreparable because they cannot be
remedied by money damages. See L.A. Mem’l Coliseum Commc’n v. Nat’l
Football League, 634 F.2d 1197, 1202 (9th Cir.1980).
Finally, the district court did not abuse its discretion by determining that
the balance of equities and the public interest favor a preliminary injunction
because cancer patients would be denied access to Lederer’s level of expertise for
certain procedures if the Medical Center were not preliminarily enjoined. The
district court’s preliminary injunction is narrowly tailored to avoid the harm that
would result if Lederer could not access the Medical Center’s facilities. The
granting of this narrow preliminary injunction was not an abuse of discretion.
AFFIRMED.
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