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Gallo v. Mayo Clinic Health System-Franciscan Medical Center, Inc.

United States District Court, W.D. Wisconsin

January 24, 2017

ELISA S. GALLO, MD, Plaintiff,

          OPINION & ORDER

          JAMES D. PETERSON District Judge

         Plaintiff Elisa S. Gallo brings this case against her former employer, Mayo Clinic Health System-Franciscan Medical Center, Inc., and her supervisor there, Michael White. Gallo contends that defendants breached her separation agreement, which prohibited defendants from making unfavorable comments in response to requests for references from prospective employers. Gallo contends that she lost a job at another clinic after White rated aspects of Gallo's performance “fair.” The “fair” ratings, according to Gallo, were unfavorable references that breached the separation agreement.

         Three motions are before the court: (1) defendants' motion to enforce a settlement agreement, Dkt. 65; (2) defendants' motion for summary judgment, Dkt. 39; and (3) Gallo's motion to strike the declaration of Corinna Manini, Dkt. 56.

         I will deny the motion to enforce the settlement because Wisconsin law requires that settlement agreements be in writing. I will deny Gallo's motion to strike because the failure to get Manini's deposition is due primarily to Gallo's lack of diligence. I will grant defendants' motion for summary judgment. White gave the “fair” ratings in response to a credentialing evaluation, a request that was not specifically addressed in the separation agreement, and I conclude that White's ratings did not breach the separation agreement. I also conclude that Gallo has not adduced admissible evidence to show that defendants' conduct caused her to lose the new job.


         The following facts are not genuinely disputed except where noted. Gallo is a dermatologist who worked at a Mayo Clinic facility in LaCrosse, Wisconsin, starting in February 2010. (I'll refer to this entity simply as Mayo Clinic.) White is the chairman of the dermatology department at Mayo Clinic and Gallo's former supervisor.

         A. Gallo's resignation from Mayo Clinic and the Separation Agreement

         In September 2010, White met with Gallo to discuss performance issues. White outlined corrective steps that Gallo would have to take to continue her employment. But Gallo did not take those steps, and Mayo Clinic placed Gallo on unpaid leave. Gallo then resigned from her position and entered a written Separation Agreement with Mayo Clinic.

         The Separation Agreement contained a provision that specified how Mayo Clinic would respond to reference requests from prospective employers. That provision, Section 1.B of the Separation Agreement, states the following:

The parties have agreed upon a letter of reference for Employee to be provided to potential employers seeking a reference. The letter of reference is attached hereto as Exhibit A and incorporated herein. Employer will provide a signed original letter of reference on company letterhead not marked as an exhibit within two business days this Agreement is signed by Employee. In the event Employer receives any requests for a verbal reference for Employee, all such requests shall be directed to Barbara Saathoff [in-house counsel at Mayo Clinic], who will respond to the inquiry pursuant to normal procedural protocol relevant to Employee's dates of employment and position. Employer will state nothing that will be inconsistent with the letter of reference (Exhibit A) attached hereto. No reference will be made to any performance issue and nothing derogatory will be stated. Employer agrees that it will expunge all references to any disciplinary or performance concern relevant to Employee. If asked why Dr. Gallo has left its employ, Employer will state only that due to the dire medical situation with her grandmother that Dr. Gallo desires to relocate to Chicago. Nothing will be stated or inferred that Dr. Gallo is not eligible for re-employment at any time.

Dkt. 1-1, at 1-2.

         B. Gallo's employment application at Refuah Health Center

         In June 2013, Gallo applied for a dermatologist position at Refuah Health Center in New York City. Refuah extended Gallo an offer of employment in August 2013, but Refuah eventually declined to hire Gallo. Most of the important facts surrounding the Refuah episode are undisputed, but the parties draw different conclusions about why Refuah did not hire Gallo. Defendants contend that Refuah rescinded its offer because Gallo prolonged the negotiation by pressing for unreasonable terms and that Refuah decided to fill its staffing needs with a dermatologist who was already working at Refuah. Dkt. 45, at 8. But Gallo contends that Refuah did not hire her because White gave her fair ratings in response to a request for information from Mount Sinai Hospital, which had a relationship with Refuah.

         Here are the facts. Refuah extended a first job offer to Gallo in August 2013. From August to September 2013, Gallo negotiated various terms of her employment contract with Corinna Manini, the director of Medical Services at Refuah. While the negotiation went on, Manini wrote an email to one of her colleagues stating, “I can't stand Gallo.” Dkt. 44-5. Refuah rescinded its offer a few days later, September 18, 2013, and filled the position with a dermatologist who had already been working at Refuah. About a month later, Gallo wrote to Manini and explained that she would “accept whatever [Refuah]” had to offer. Dkt. 44-6; see also Dkt. 75, ¶ 62. Between mid-October to December 2013, Gallo and Manini discussed the prospect of Refuah hiring Gallo for another position at Refuah, and in December 2013, Refuah extended an offer to Gallo for that position. For the next few months, Gallo worked on getting licensed to practice medicine in New York, and Refuah extended another offer in April 2014. Gallo then began further negotiation of the terms of her employment. On April 30, 2014, Manini wrote to Mark Lebwohl, a dermatologist at Mount Sinai Hospital who had referred Gallo to Refuah, that “Gallo is driving us nuts.” Dkt. 44-8. On May 6, 2014, Gallo wrote an email raising 18 additional issues concerning her employment contract. 44-9, at 1-2. The same day, Manini wrote another internal email, stating, “I am happy to rescind the offer.” Dkt. 44-10. Manini also told Lebwohl that Gallo was “very unreasonable” and “questioned whether Gallo was the right person for the job.” Dkt. 75, ¶ 117.

         Gallo tells another part of the story. Mount Sinai Hospital-where Lebwohl was chair of dermatology-regularly sends its residents to Refuah, and doctors at Refuah often supervise residents from Mount Sinai. Because of this relationship, Refuah doctors who might supervise Mount Sinai residents need to be, in hospital parlance, “credentialed” by Mount Sinai before starting employment at Refuah. As part of its credentialing process, Mount Sinai sends credential forms to the prospective doctor's former supervisors, asking the former supervisors to rate the candidate from “poor” to “superior” in 13 categories. In Gallo's case, Mount Sinai sent a credential form to White, and White-after seeking advice from Barbara Saathoff, in-house counsel at Mayo Clinic-completed the form. Dkt. 75, ¶¶ 83-86. For 11 out of the 13 categories, White rated Gallo “superior” or “good.” Dkt. 75, ¶¶ 90-91. But White rated Gallo “fair” on the two remaining categories: (1) accepting feedback; and (2) ability to work with others. Dkt. 43, ¶ 41. White gave those two fair ratings primarily on the basis of Gallo's conduct that led to her meeting with White and eventually her resignation in September 2010, and the parties agree that the ratings represent his honest, good-faith responses to the questions posed on the credential form. Dkt. 75, ¶¶ 93-95.

         Mount Sinai contacted White to inquire further about Gallo. White spoke with the director of credentialing at Mount Sinai and to Lebwohl and told them both that Gallo was a good physician and that he did not want to hurt Gallo's employment prospects. Dkt. 75, ¶¶ 97-105. Gallo's credentialing file was not sent to Lebwohl's review, which was a preliminary step toward approval, and the credentialing committee did not make any recommendation or decision concerning Gallo's credentials. Dkt. 75, ¶¶ 113-116. Refuah did not formally rescind its last offer to Gallo. Dkt. 55, ¶ 24. Instead, Refuah filled its staffing needs with dermatologist employed by Mount Sinai who was already placed at Refuah and treating patients there.

         C. Procedural history

         Gallo filed her complaint in May 2015, asserting tortious interference and breach of contract claims. Gallo later withdrew her tortious interference claim. In August 2016, defendants moved for summary judgment, Dkt. 39, and Gallo moved to strike the declaration of Manini, Dkt. 56. While these two motions were pending, the parties mediated and reached a settlement in principle. Dkt. 61. But Gallo refused to sign the written settlement agreement, reporting to the court that she had been forced into the settlement. Defendants filed a motion to enforce the settlement agreement. Dkt. 65. The two law firms who had been representing Gallo moved to withdraw, Dkt. 69, and I granted that motion, Dkt. 70. Gallo soon retained a third law firm to represent her, and she moved to stay proceedings and asked for a status conference. Dkt. 88. I denied that motion, but I gave Gallo additional time to make the one filing that she had outstanding, her reply in support of her motion to strike the Manini declaration. Dkt. 92. All three motions are now fully briefed.


         A. Defendants' motion to enforce settlement

         Defendants contend that the settlement agreement reached at the mediation is enforceable. They argue that “[a]n oral agreement to settle an employment claim is enforceable in federal court; such an agreement does not need to be reduced to writing to be binding.” Dkt. 66, at 3. They would be correct if federal law governed Gallo's claims. But Gallo asserts state-law contract ...

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