In most matters involving a license denial or proposed disciplinary action by an agency, an appeal of the matter rests with State Office of Administrative Hearings (“SOAH”). The matter may be “litigated” with a formal discovery and hearing process (discussed below), however, many matters may resolve with mediation, which is usually conducted at SOAH.
There are two primary settings in the Firm’s practice which involve formal mediation which will be addressed here. Members of the Firm are actively involved in mediation activities on a regular basis. Mediation is an arena where the attorney’s reputation and credibility are absolutely critical. Education of the mediators as to the issues, as well as preparation of the Licensee for a face to face meeting are extremely important. An effective attorney must not only possess communication skills, but also experience, understanding, and creativity as to possible resolutions.
Mediation involving state licensing matters are held at SOAH. Once a licensing agency has provided an opportunity to a licensee to show compliance with the statute and rules of the agency, typically through an Informal Settlement Conference (ISC) or “show cause” proceeding, if a matter is not dismissed or resolved by agreement, the licensee has a right to a formal hearing (trial) with rules of evidence and procedure before an Administrative Law Judge (“ALJ”). This hearing is docketed and conducted as a trial by SOAH. As a part of the SOAH process, mediation is allowed by consent of the parties (the Agency and the Licensee). This mediation occurs before the hearing and may even occur prior to discovery. It is intended to save the parties time, money, and the uncertainty of a hearing’s outcome. Mediation is conducted in a traditional manner, with SOAH mediators who, though not assigned as hearing judges on the contested case at hand, have experience hearing cases as well. Representatives of the licensing agency, the licensee, and the attorneys for both parties meet together in a neutral setting to seek a resolution of the case. The proceedings are confidential and may not be used for any purpose if the case fails to settle and proceeds to hearing. Mediation is usually very successful in reaching resolution though less so in matters where there is stringent and wide disagreement as to the facts or legal interpretations on issues.
Mediation is not subject to any rules of evidence or procedure, and in fact much of the success of the mediation depends on the parties’ preparation and the ability to communicate and persuade the opponents regarding the particular strengths and weaknesses of a specific case. Strategically, the practitioner’s legal counsel and the practitioner must be prepared to adjust to different viewpoints or settlement offers (and to foresee the effects of any settlement) made throughout the mediation process. Mediators may help move the parties to an agreeable resolution but cannot force the parties to agreement. Lack of resolution puts the parties back into the formal hearing process before an ALJ who will hear evidence and ultimately render a recommendation to the licensing board, referred to as Proposal for Decision (“PFD”).
Texas law also provides a right to physicians to demand mediation in a medical staff peer review proceeding, which is an internal process to a hospital (see http://sharpcobos.com/expertise/peer-review/). As Texas law does not specify at which stage of the process it may be conducted, hospital medical staff bylaws will usually specify the procedural stage for mediation. Sometimes the mediation is afforded prior to the peer review fair hearing, sometimes afterwards. There are benefits and risks to both procedural alternatives. The hospital or entity is required by law to mediate if requested by the provider, but it is not required to reach agreement. Depending upon the reasonableness of the parties and the dynamics of internal medical politics, mediation in the medical staff peer review process either can be extremely successful or disappointing. Generally, each side pays for part of the mediation costs. If not resolved at mediation, then the physician usually still has the right to proceed to a hearing process within the hospital system and under its Bylaws. It is important to note that an internal hospital peer review proceeding lacks many of the procedural, discovery, and evidentiary standards that apply at SOAH.
If a disciplinary or licensing matter is not resolved with the agency, a formal Complaint or Petition is filed at SOAH, where it is assigned to an Administrative Law Judge (“ALJ”). The ALJ then asks the parties to submit proposed dates for hearing (trial) along with an agreed scheduling order as to deadlines for “discovery”, motions/responses, and other pre-trial matters.
Discovery usually includes depositions (formal sworn pre-trial testimony before a court reporter), exchanges of possible evidence, interrogatories (written questions), and requests for admissions sent by both parties to each other. In many situations, legal research may also be necessary as to discovery or trial issues, or research as to standard of care or as to legal issues. Discovery can and does entail significant time and preparation and its process is nearly identical to the civil trial process (i.e. subject to the rules of procedure and evidence).
Depositions are usually a whole day process and take place at the locale of the fact or expert witnesses’ city of residence. Preparation prior to deposition is also necessary. It is usually preferable to take an expert or fact witness’ deposition(s) to discern the basis for his/her testimony. Often, agency staff will take the licensee’s deposition to discern testimony and to pin opinions down.
Written discovery includes Requests for Disclosure, which comprises written inquiries of the parties as to proposed witnesses, possible exhibits, and legal theories of the case. Written interrogatories are similarly questions propounded to each side seeking to “discover” the existence of any documents or witnesses which may be relevant to the case or which may lead to other evidence. Each side must draft its own sets of questions and responses to such requests. Requests for Admissions aim directly at trying to require the other side to admit to factual or legal issues. Any dispute as to discovery entails filing a motion (and responses) with the ALJ and possibly a pretrial hearing before the ALJ.
Once discovery is completed, which is usually extended over several months’ time, the matter proceeds to a public trial (hearing) before the assigned ALJ at SOAH. The ALJ hears evidence, just as in a trial in civil court, with rules of evidence as to admissibility of documents or testimony. After hearing the evidence and considering the documents, the ALJ then issues a written “Proposal for Decision”, which is a summary of his recommended Findings of Fact and Conclusions of Law. Findings of Fact are obviously what happened, what the standard is (usually based upon expert review), and whether a licensee factually deviated from the standards. Conclusions of Law are directed at whether those factual findings constitute violations of law or rules. After trial/hearing the Proposal for Decision with these findings/conclusions is referred back to the agency for review and possible adoption or modification.
After a hearing and recommendation from the ALJ, and agency review, the agency or the licensee may still appeal to district court under the Administrative Procedure Act. In district court, the record (transcripts, pleadings, motions, etc.) is reviewed. There is no new trial with expert/fact witnesses or re-litigation of the factual issues. Generally, the court reviews the written record to determine whether there is “substantial evidence” to support the Order adopted by the agency. However, the term “substantial evidence” has been interpreted to be “some” (not even “substantial”) evidence to support the Order’s findings and conclusions.
Generally, Findings of Fact are more difficult to challenge after hearing or in district court. The trier of fact, i.e. the ALJ, is given deference as to what evidence was heard and was weighed by him. Credibility issues are also usually left to the ALJ. Thus, the ALJ will hear from expert and fact witnesses and assess their testimony, as well as weigh any documentary evidence. These factual findings are usually difficult to overturn in district court whether they are in the licensee or agency’s favor or not.
Conclusions of Law (i.e. the interpretation of the law) may be subject to the agency’s interpretation, which may be given deference by the courts. Though not binding on the courts, the courts will often defer to the agency’s interpretation if it is a “reasonable” interpretation and the statute or rule is also “ambiguous”.
If a matter is found to be without factual and legal support by the ALJ, many agencies will dismiss the matter. However, with certain limitations and with written/evidentiary support, an agency may modify the ALJ’s findings. For Medical Board matters, the Board must adopt the ALJ findings of fact and conclusions of law. Though the Board may still appeal to district court, certain legal limitations are in place as to the scope of the review.
In any event, the SOAH litigation process, which can be lengthy and time consuming, may be the only viable avenue to challenge an agency recommendation. Therefore, it is incumbent upon a licensee to seek legal representation as early as possible in the investigation process. Many matters may be dismissed or settled in the investigation or Informal Conference settings without the necessity of a SOAH hearing. Should the matter proceed to SOAH, Sharp & Cobos is experienced in providing effective factual and legal representation.