Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-05-03403/USCOURTS-ca8-05-03403-0/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 

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1

The HONORABLE CAROL E. JACKSON, Chief Judge of the United States

District Court for the Eastern District of Missouri. 

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 05-3403

___________

Arthur J. Misischia, Dr., D.M.D., *

*

Plaintiff - Appellant, *

* Appeal from the United States

v. * District Court for the

* Eastern District of Missouri.

St. John's Mercy Health Systems, et al., *

*

Defendants - Appellees. *

___________

Submitted: April 17, 2006

Filed: August 8, 2006

___________

Before LOKEN, Chief Judge, LAY and BYE, Circuit Judges.

___________

LOKEN, Chief Judge.

At the conclusion of largely unsuccessful litigation in other courts, Dr. Arthur

Misischia commenced this action against his former employers, St. John’s Mercy

Health Systems (St. John’s) and Dr. John Delfino, and three St. John’s supervisory

employees. Misischia asserted claims under the Racketeer Influenced and Corrupt

Organizations Act (RICO), 18 U.S.C. §§ 1962(b)-(d), and a pendent state law

conspiracy claim. The district court1

 dismissed the claims on res judicata and statute

of limitation grounds. Misischia appeals. Reviewing the district court’s dismissal of

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the complaint de novo, we affirm. See Ballinger v. Culotta, 322 F.3d 546, 548 (8th

Cir. 2003) (standard of review). 

I. Background

In 1993, Delfino was the director and Misischia was the associate director of

the oral and maxillofacial surgery residency program at St. John’s hospital in St.

Louis. Misischia also performed surgeries at St. John’s hospital as an independent

contractor retained by Delfino’s professional corporation. Following reports of

inappropriate patient contacts, St. John’s terminated Misischia as associate director

and suspended his staff privileges in October 1993. Delfino also terminated his

separate contract with Misischia. As required, St. John’s reported Misischia’s

suspension to the Department of Health and Human Services National Practitioner

Data Bank [NPDB] in February 1994. At St. John’s request, Misischia underwent a

psychiatric evaluation in March 1994 that revealed no disorder. St. John’s then ended

the suspension and revised its adverse action report to the NPDB to read: “Based on

the receipt of a positive [psychiatric] evaluation, the summary suspension of Dr.

Arthur Misischia has been revoked effective April 25, 1994.” However, St. John’s

also terminated Misischia’s employment contract and staff privileges.

In October 1994, Misischia filed a lawsuit in Missouri state court against St.

John’s and Delfino, asserting various state law tort claims based on the allegation that

Misischia’s suspension, termination, and the adverse NPDB report were retaliation for

his efforts to “blow the whistle” on fraudulent activity by Delfino and St. John’s. The

trial court held that St. John’s was immune from suit under the Health Care Quality

Improvement Act, 42 U.S.C. §§ 11101 et seq., and dismissed some claims against

Delfino. A jury then found in favor of Misischia and against Delfino and his

professional corporation on a fraud claim. The decision was affirmed on appeal and

final judgment entered in December 2000. See Misischia v. St. John’s Mercy Med.

Ctr., 30 S.W.3d 848 (Mo. Ct. App. 2000).

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In March 2001, counsel for Misischia wrote St. John’s offering to release all

claims if St. John’s would submit a revised NPDB report deleting the reference to a

psychiatric evaluation. St. John’s responded, agreeing to submit the revised report if

Misischia also agreed not to serve as a retained expert in lawsuits against St. John’s

and to pay an amount in satisfaction of St. John’s pending motion for costs in the state

court action. Protracted, unsuccessful negotiations ensued. In this action, Misischia

alleges that defendants sought to discredit him by submitting an inaccurate NPDB

report in 1994 and then refused to correct the inaccuracies in 2001 unless he acceded

to their “extortionate” demands. 

In March 2002, with negotiations at a standstill, Misischia filed a “subject

statement” with the Department of Health and Human Services objecting to the

content and accuracy of St. John’s revised NPDB report. The agency concluded that

the phrase “positive evaluation” in St. John’s revised report could be misinterpreted

as implying that Misischia suffers from a psychiatric disorder. Accordingly, St.

John’s amended the report to read: “Based on the receipt of an evaluation that found

that Dr. Arthur Misischia was not suffering from any type of psychiatric disorder, the

summary suspension of Dr. Arthur Misischia has been revoked effective April 25,

1994.” However, the agency rejected Misischia’s demand to delete all reference to

a psychiatric evaluation. Misischia sued the agency alleging a violation of the Privacy

Act, 5 U.S.C. § 552a. The District of Columbia District Court dismissed the suit as

time-barred, concluding that the Privacy Act’s two-year statute of limitations began

to run when St. John’s revised the NPDB report in May 1994. Doe v. Thompson, 332

F. Supp. 2d 124 (D. D.C. 2004). 

Ten days later, Misischia filed this lawsuit. His lengthy amended complaint

first describes every aspect of the parties’ dispute from 1993 to 2003 and then alleges

“various adverse professional incidents” involving other physicians with privileges

at St. John’s hospital. The amended complaint alleges that defendants collectively

constituted an “enterprise,” that their wrongful actions constituted a “pattern of

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racketeering activity,” and that the mailings and interstate wire communication cited

in the complaint were “predicate acts” under RICO. In addition to three RICO counts,

Misischia asserts a state law civil conspiracy claim. The remedies sought include an

order declaring that defendants “improperly and without justification” compelled

Misischia to undergo a psychiatric examination, submitted an adverse report to the

NPDB, terminated his employment and staff privileges, and damaged his reputation

in order to taint his testimony as an adverse expert witness in lawsuits against the

hospital. 

II. Res Judicata

The district court held that the doctrine of res judicata or claim preclusion bars

Misischia’s RICO and civil conspiracy claims because he could have raised those

claims in his October 1994 state court suit. Though RICO is a federal statute, the

preclusive effect of this prior state court judgment is governed by the law of Missouri,

the State in which the judgment was rendered. See Marrese v. Am. Acad. of

Orthopaedic Surgeons, 470 U.S. 373, 380 (1985). 

Under Missouri law, a prior judgment bars a subsequent claim arising out of the

same group of operative facts “even though additional or different evidence or legal

theories might be advanced to support” the subsequent claim. Chesterfield Village v.

City of Chesterfield, 64 S.W.3d 315, 320 (Mo. banc 2002) (quotation omitted). The

doctrine of claim preclusion bars not only the claims asserted in the first action but

also claims “which the parties, exercising reasonable diligence, might have brought

forward at the time.” Id. at 318 (quotation omitted); see McNeill v. Franke, 84 F.3d

1010, 1012 (8th Cir. 1996). Thus, the critical question here is whether Misischia

could have raised his RICO and civil conspiracy claims in the prior state court suit.

The district court answered this question in the affirmative. The court listed ten letters

and wires sent by defendants between August 1993 and July 1994 that are alleged by

Misischia to be RICO predicate acts and then explained:

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To state a RICO claim, plaintiff must show (1) conduct (2) of an

enterprise (3) through a pattern (4) of racketeering activity. . . . Mail

fraud and wire fraud are among the predicate acts that can form the basis

of a RICO claim. Plaintiff’s amended complaint identifies several

instances of alleged mail or wire fraud that occurred before he filed [the

state court action]. His allegation of additional acts after the disposition

of [that action] does not alter the fact that the basis for his racketeering

claim existed during the pendency of that prior case.

On appeal, Misischia first argues that res judicata bars only claims identical to

those raised in the prior lawsuit. He relies on cases properly holding that res judicata

does not bar claims that did not exist when the prior judgment was entered. See

generally Baker Group, L.C., v. Burlington N. & S.F. Ry., 228 F.3d 883, 885-87 (8th

Cir. 2000). But that is a different issue. The argument that only identical claims are

precluded is directly contrary to Chesterfield and other Missouri cases holding that res

judicata bars a claim that could have been raised in the first lawsuit. 

Misischia next argues that he could not have raised his RICO claims in the state

court suit because (a) the ten predicate acts that occurred in the year prior to October

1994 were insufficient to prove the requisite pattern of racketeering activity needed

to sustain a RICO claim, and (b) defendants committed additional predicate acts

causing new injuries after the 2000 judgment in the state court case, namely, the

“extortionate” demands in 2001 and 2002 that compelled Misischia to incur legal fees

to challenge the false NPDB report. We disagree. 

A “pattern of racketeering activity” is defined (rather unhelpfully) in 18 U.S.C.

§ 1961(5). Before Misischia filed his state court lawsuit, the Supreme Court construed

the term as requiring proof of related racketeering predicates that pose a threat of

continued criminal activity. H.J., Inc. v. Northwestern Bell Tel. Co., 492 U.S. 229,

239 (1989). Applying this standard, we had affirmed the dismissal of RICO claims

based upon predicate acts occurring over a short period of time and threatening no

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future criminal conduct. See Thornton v. First State Bank of Joplin, 4 F.3d 650 (8th

Cir. 1993); Lange v. Hocker, 940 F.2d 359 (8th Cir. 1991). Here, Misischia’s

amended RICO complaint alleged ten predicate acts that occurred in the year before

he filed the state court action in October 1994. Those acts may or may not have been

sufficient to state and prove a RICO violation. But they caused the bulk of

Misischia’s alleged injuries -- wrongful suspension, a psychiatric evaluation,

termination, and the filing of a false NPDB report -- and the alleged predicate acts

occurring thereafter added little if anything to his RICO claims. Thus, whether or not

sound, the RICO claims could have been raised in October 1994. 

In particular, the three “extortionate” letters exchanged with counsel for St.

John’s in 2001 and 2002, on which Misischia places great emphasis, were so unrelated

to the events of 1993 and 1994 as to add nothing to the showing that the earlier acts

reflected “a threat of continued racketeering activity,” the prerequisite of a RICO

claim under H.J., Inc., 492 U.S. at 242. In these circumstances, we agree with the

district court that Misischia’s RICO claims -- and likewise his state law civil

conspiracy claim -- could have been raised in the state court suit and are therefore

barred by the prior state court judgment. The question is not whether the alleged

predicate acts occurring after the state court judgment would support an independent

RICO claim. The question is whether adding those predicate acts to the acts occurring

in 1993 and 1994 can revive RICO claims that are otherwise barred. “The doctrine

of res judicata would become meaningless if a party could relitigate the same issue .

. . by merely positing a few additional facts that occurred after the initial suit.” Dubuc

v. Green Oak Township, 312 F.3d 736, 751 (6th Cir. 2002).

III. Other Issues

Having concluded that the district court properly dismissed all of Misischia’s

federal and state claims with prejudice as barred by the doctrine of res judicata, we

need not consider the court’s alternative holding that the RICO claims are barred by

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RICO’s four year statute of limitations. See generally Rotella v. Wood, 528 U.S. 549

(2000); Klehr v. A.O. Smith Corp., 521 U.S. 179 (1997); Love v. Nat’l Med. Enters.,

Inc., 230 F.3d 765, 772-75 (5th Cir. 2000); In re Merrill Lynch Ltd. P’Ships Litig.,

154 F.3d 56, 58-60 (2d Cir. 1998). 

Misischia further argues that the district court abused its discretion in denying

him leave to amend his complaint. This contention is without merit. In the district

court, Misischia raised this issue with a one line request in his brief opposing

defendants’ motion to dismiss: “in the alternative, should the Court disagree with

Plaintiff, Plaintiff respectfully requests leave to amend his Complaint.” He made no

motion for leave to amend and did not explain the substance of his proposed

amendment. Thus, there was no abuse of discretion. See United States ex rel. Lee v.

Fairview Health Sys., 413 F.3d 748, 750 (8th Cir. 2005). Misischia also argues that

the district court erred in denying his motion to disqualify St. John’s attorneys. As the

entire lawsuit was properly dismissed with prejudice, this issue is moot. 

Defendants filed motions for sanctions under Rule 38 of the Federal Rules of

Appellate Procedure and for an award of attorneys fees under 28 U.S.C. §§ 1912 and

1927, asserting that Misischia’s appeal is frivolous. Under Rule 38, an appeal is

frivolous “when the result is obvious or when the appellant’s argument is wholly

without merit.” Newhouse v. McCormick & Co., 130 F.3d 302, 305 (8th Cir. 1997)

(citations omitted). Here, while Misischia’s attempt to prolong a dispute already

litigated in multiple forums is hardly worthy of praise, the res judicata and statute of

limitations issues are subject to reasonable dispute, and if Misischia had prevailed on

his broadest contentions, the RICO claims could have gone forward against all

defendants. Accordingly, we deny the motions. 

The district court’s order of dismissal dated August 5, 2005 is affirmed. 

______________________________

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