George Indest HeadshotBy George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law

On November 16, 2016, an appeals court in Texas affirmed a $1.37 million sanction assessed against a doctor. The doctor was ordered to pay the sanction after the dismissal of a defamation lawsuit he filed against his former employers. The doctor’s former employers were Baylor College of Medicine (Baylor) and Texas Children’s Hospital.

The case had previously been appealed to the Texas Supreme Court. This makes the November 16, 2016, opinion the second time the Texas Fourteenth Court of Appeals has had to rule on the case. Additionally, it is the second time that it has held that the sanctions against Dr. Rahul K. Nath were justified.

The Back Story of the Case.

According to the opinion, Dr. Nath was employed by Baylor as a plastic surgeon and was affiliated with Texas Children’s Hospital. He was allegedly terminated in 2004. In February 2006 he filed a lawsuit against his former supervisor at Baylor and Texas Children’s. According to court documents, Dr. Nath had accused his former supervisor of making defamatory statements about him after he stopped working there. The alleged defamatory statements included that Dr. Nath had been fired, was unqualified and lacked professional ethics and integrity.

To read the court opinion, click here.

Was the Former Employer Responsible for Accumulated Fees?

The Texas high court was considering whether the behavior of Baylor or Texas Children’s was ultimately responsible for the attorney’s fees that had been accrued in the case. Previously, the trial court found that both Texas Children’s and Baylor’s actions had not caused the litigation expenses which Dr. Nath was assessed. The trial court wrote that the amount was appropriate as it was “far less” than the actual fees incurred by either party in defending Dr. Nath’s claims.

On appeal, Dr. Nath argued that the trial court hadn’t held a proper evidentiary inquiry and that it had based its sanctions award on “conclusory and self-serving” affidavits. Dr. Nath claimed that he was wrongly denied discovery in the case. To learn more about Dr. Nath’s legal challenge, click here.

Despite Dr. Nath’s arguments, the court of appeals disagreed, holding that the trial court followed the Supreme Court’s instructions in deciding to impose the sanctions. Additionally, the court found that there was evidence in the record to support the conclusion that neither Texas Children’s nor Baylor’s conduct caused the legal expenses that were passed on to Dr. Nath as sanctions.

Adequate Supporting Evidence.

The first time the case came before the Fourteenth Court of Appeals, it affirmed the sanctions against Dr. Nath. The high court held that there was evidence to support the trial court’s finding of bad faith and improper purpose on Dr. Nath’s part with regard to certain filings in the case. Dr. Nath appealed, and the Texas Supreme Court held that the trial court didn’t abuse its discretion in finding the doctor had exercised bad faith and improper purpose in certain filings.

To learn more about defamatory statements and how to handle such claims, click here to read one of my prior blogs.

Contact Experienced Health Law Attorneys.

The Health Law Firm routinely represents physicians, pharmacists, dentists, nurses, medical groups, health facilities, nurses and other health providers in complex litigation, investigations, Medicare Audit defense, regulatory matters, licensing issues, litigation, inspections and audits involving the DEA, Department of Health (DOH) and other law enforcement agencies. Its attorneys include those who are board certified by The Florida Bar in Health Law as well as licensed health professionals who are also attorneys.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at


Knaub, Kelly. “Texas Appeals Court Affirms Doc’s $1.3M Sanction.” Law360. (November 16, 2016). Web.

Knaub, Kelly. “Doc To Challenge $1.3M Sanction Before Texas High Court.” Law360. (January 15, 2014). Web.

“Texas Appeals Court Affirms Doc’s $1.3M Sanction.” LexisNexis. (November 16, 2016). Web.

About the Author: George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone: (407) 331-6620.

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