Special Fee Shifting Statute: Lower Court Properly Denied Attorney’s Fees To Prevailing Doctor In Staff Privilege Suspension/Termination Case Against Hospital Because Hospital’s Defense Was Not Completely Frivolous In Nature

Business and Professions Code Section 809.9 Was The Fee Shifting Statute.

            In Economy v. Sutter East Bay Hospitals, Case Nos. A150211 et al. (1^st Dist., Div. 4 February 4, 2019) (published), defendants hospital were found to have improperly suspended/terminated a physician without a proper hearing under Business and Professions Code section 809 et seq, with the trial court awarding doctor $3.867 million in damages but denying the physician an award of attorney’s fees under section 809.9, which requires a mandatory award of fees to the “substantially prevailing party” if the hospital’s conduct in defending or litigating the case was “frivolous, unreasonable, without foundation, or in bad faith” (with frivolousness judged objectively and bad faith judged subjectively). The appellate court affirmed the denial of fees, finding that the lower court correctly concluded that hospital’s defense was not completely lacking in merit and there was tenability in the argument that hospital’s actions did not have to be reported (although ultimately failing on the merits).