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Parungao v. Community Health Systems Inc.

United States Court of Appeals, Seventh Circuit

May 24, 2017

R. Sherwin Parungao, Plaintiff-Appellant,
v.
Community Health Systems, Inc., et al., Defendants-Appellees.

          Argued April 26, 2017

         Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. l:15-cv-04453 - Robert W. Gettleman, Judge.

          Before Wood, Chief Judge, and Ripple and Sykes, Circuit Judges.

          Per Curiam.

         This is the fourth lawsuit that Dr. R. Sherwin Parungao, a surgeon, has brought against affiliates of Galesburg Cottage Hospital. The district court ruled that Dr. Parungao's complaint was barred by res judicata and Illinois's closely related single-refiling rule. Because we agree that this suit violates the doctrine of res judicata, we affirm the district court's judgment.[1]

         I

         BACKGROUND

         Dr. Parungao began practicing surgery at Galesburg Cottage Hospital in 2006. He first worked as a private practitioner, but later accepted employment with Knox Clinic, which supplies doctors for the hospital. Knox Clinic told Dr. Parungao in May 2013 that it was discharging him without cause, as allowed under his employment agreement. Dr. Parungao believes that the hospital orchestrated this discharge to harm his career. He asserts that before Knox Clinic fired him, the hospital's medical executive committee manipulated the peer-review process to insinuate that he had performance problems and make it difficult for him to secure future employment. Dr. Parungao later resigned from Galesburg and sought other employment, but alleges that he was thwarted in those efforts by the hospital and its doctors.

         This is not the first time Dr. Parungao has attempted to recover based on these, or similar, allegations. His first suit against Galesburg Cottage Hospital and its corporate affiliates was voluntarily dismissed. See Doe v. Cmty. Health Sys. Prof'l Servs. Corp., Galesburg Hosp. Corp., & Knox Clinic Corp., No. 2013-CH-73 (Knox Cty, 111. Cir. Ct, filed July 15, 2013). The day after he voluntarily dismissed that action, Dr. Parungao filed another petition in the same court, requesting to refile the case under seal and under a fictitious name. That petition was denied, so no complaint or suit was filed. Dr. Parungao then brought another suit in state court against the chief of the medical staff at Galesburg, Dr. Daniel K. Piper. See Parungao v. Piper, No. 2013-L-40 (Knox Cry., 111. Cir. Ct, filed Oct. 21, 2013). Because this appeal and the defense of res judicata rest on the relationship between the Piper litigation and Dr. Parungao's current federal lawsuit, we briefly compare the allegations set forth in the two relevant complaints.

         In October 2013, Dr. Parungao sued Dr. Piper for defamation in circuit court in Knox County, Illinois. That lawsuit focused on the time during which Dr. Parungao sought employment at other hospitals after he resigned from Galesburg. He alleged that Dr. Piper had made false and harmful representations to hospital entities with which he sought employment. These representations, made in letters bearing Galesburg Cottage Hospital letterhead, suggested to those entities that Dr. Parungao had been the subject of some type of nondisciplinary action related to his professional conduct. The relevant allegations from the Piper complaint are set forth below:

7. Although Dr. Parungao's privileges to practice at GCH [Galesburg Cottage Hospital] remained intact, Dr. Parungao ceased performing surgeries at GCH on or about May 15, 2013, and he thereafter sought employment elsewhere.
8. On or about May 28, 2013, Dr. Piper represented to Gaye Shaw, Director of Medical Staff Affairs at St. Mary's Hospital in Centralia, Illinois (collectively "St. Mary's") that he was authorized to respond to a request by St. Mary's for verification of Dr. Parungao's staff privileges and credentials at GCH.
9. On or about May 28, 2013, Dr. Piper represented to Natalie Brown, Medical Staff Coordinator at Weatherby Locums in Fort Lauderdale, Florida (collectively "Weatherby") that he was authorized to respond to a request by Weatherby for verification of Dr. Parungao's staff privileges and credentials at GCH.
10. Dr. Piper informed St. Mary's and Weatherby that Dr. Parungao was not the subject of any disciplinary action as a member of the Medical Staff, he was the subject of "other action" as a result of an ongoing review related to his participation in an impaired practitioner program.
11. Dr. Piper defined "other action" as ...

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