Appellant radiology medical group challenged a judgment of the Superior Court of Los Angeles County (California) granting appellees, insurer and claims administrator, summary judgment in appellant’s breach of contract action.
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Overview
Radiologist, employed by appellant radiology medical group, was terminated. Thereafter, she filed a lawsuit against appellant based on wrongful termination. Appellant settled the matter, incurring substantial legal fees. Appellees, insurer and claims administrator, insured appellant under a medical malpractice policy, which required appellees to indemnify the insured for damages because of injury arising out of the rendering professional services, defined as services performed in the practice of the profession of a physician. Appellees refused to defend appellant in radiologist’s suit. Appellant brought an action against appellees claiming breach of contract. Appellees were granted summary judgment based on its argument that a decision to fire an employee did not constitute professional services. The court affirmed, holding that an insurance policy for medical malpractice did not require the insurer to defend a wrongful termination lawsuit. The court determined that the decision to terminate employment was a business or administrative decision, and in making such a decision, the physician was acting as an employer and not as a physician rendering services.
Outcome
The judgment was affirmed. An insurance policy for medical malpractice did not require appellees, insurer and claims administrator, to defend a wrongful termination lawsuit because the decision to terminate employment was a business decision in which appellant radiology medical group was acting as an employer.
