ALJDEC decisions subject to certification as final

25A-42668-MDX · Arizona Medical Board · 2025-01-27

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

In the Matter of:

Charles E. Kelly, M.D.

Holder of License No. 42668

For the Practice of Allopathic Medicine

In the State of Arizona.

No. 25A-42668-MDX

ADMINISTRATIVE LAW JUDGE DECISION

HEARING: January 08, 2025 at 9:00 AM.

APPEARANCES: Assistant Attorney General Seth Hargraves, Esq. appeared on behalf of the Arizona Medical Board (“Board”) with Kathryn DesMarais as a witness. No appearance(s) by or on behalf of Charles E. Leyy, M.D. (“Respondent”). Rebecca Culvan and Nicole Robinson observed.

ADMINISTRATIVE LAW JUDGE: Jenna Clark.

EXHIBITS ADMITTED INTO EVIDENCE: The December 05, 2024, Complaint and Notice of Hearing and Public Board Exhibits 1-21 were admitted into the evidentiary record.

_____________________________________________________________________

After review of the hearing record in this matter, the undersigned Administrative Law Judge makes the following Findings of Fact and Conclusions of Law, and issues this Recommended Order to the Executive Director of the Board.

FINDINGS OF FACT

Background and Procedure

The Board is the authority for the regulation and control of the practice of allopathic medicine in the State of Arizona. The mission of the Board is to protect public safety through judicious licensing, regulation, and education of all allopathic physicians.

Respondent is the holder of License No. 42668 for the practice of allopathic medicine in Arizona. Administrative Notice is taken that Respondent was first issued his license to practice in the State of Arizona on February 08, 2010. Respondent’s license is currently suspended.

Over the course of six (6) days between February 29, 2024, and March 28, 2024, the Office of Administrative Hearings (“OAH”), an independent state agency, adjudicated Case No. 24A-42688-MDX between the parties, regarding Board Cases MD-20-0379A, MD-20-0897A, MD-22-0326A, MD-22-0708A, MD-22-0896A, and MD-23-0529A.

On August 02, 2024, despite Respondent’s request for a formal Letter Reprimand with 2-year probationary term and continuing education requirement, a Recommended ALJ Decision was issued in Case No. 24A-42688-MDX that upheld the Board’s underlying Order for Summary Suspension, and also recommended that the Board revoke License No. 42688 for the practice of allopathic medicine in the State of Arizona.

At its September 04, 2024, the Board met with Respondent to review the aforementioned Recommended ALJ Decision. Ultimately, the Board voted to modify the Recommended ALJ Decision and issue a Decree of Censure to Respondent, which placed License No. 42688 on a 5-year probationary term in lieu of revocation.

On September 09, 2024, the Board issued Findings of Fact, Conclusions of Law and Order (“Final Order”) to Respondent regarding the aforementioned determination, that included an advisement that Respondent had a right to petition for rehearing or review within 35 days, or the Final Order would become effective after that time.

As part of the Final Order, Respondent was required to enroll in the Board’s Physician Health Program (“PHP”) within 5 days of the effective date of the Final Order, and participate in PHP monitoring.

The Board did not receive a request for rehearing or review from or on behalf of Respondent by October 15, 2024.

Respondent never enrolled in the PHP as required by the Final Order.

On or about November 14, 2024, the Board initiated Case No. MD-24-1076A regarding Respondent’s failure to timely enroll in the PHP, per its Final Order. Kathryn DesMarais (“Investigator DesMarais”) was assigned by the Board to investigate the confirmable facts underlying the matter.

On November 20, 2024, the Board issued correspondence to Respondent that advised a meeting would be held November 25, 2024, at 4:00 p.m. to consider Summary Action in Case No. MD-24-1076A under Ariz. Rev. Stat. § 32-1451(D).

On November 21, 2024, Respondent, through his spouse, replied that he was unable to attend on “such short notice,” and argued that the Board could not be rushed to take action against License No. 42668 because he was “not practicing medicine in Arizona or any other state.”

On November 25, 2024, the Board met to review Investigator DesMarais’ Investigative Report in Case No. MD-24-1076A. Ultimately, because Board members agreed that Respondent could not be regulated, which posed a threat to public health, safety, and/or welfare, they unanimously voted to take emergency action and summarily suspend License No. 42668 pursuant to Ariz. Rev. Stat.” § 32-1451(D).

On December 02, 2024, the Board referred this matter to OAH for an evidentiary hearing on January 08, 2025. Per the Complaint and Notice of Hearing (“Complaint”) the issue to be determined was whether the Board had cause to discipline Respondent’s license, up to and including revocation, pursuant to Arizona Revised Statutes (“Ariz. Rev. Stat.”) § 32-1451, based on alleged violations of unprofessional conduct in accordance with Ariz. Rev. Stat. §§ 32-1401(27)(s).

Hearing Evidence

The Board called Kathryn DesMarais as a witness. The substantive facts of record are as follows:

On September 10, 2024, Investigator DesMarais inquired with Respondent’s attorney (“Counsel”) as to whether he has enrolled in the PHP Monitoring Program, as required by the Final Order. On September 11, 2024, informed Investigator DesMarais that Respondent had sold his equipment and shuttered his business. Per Counsel, she was unsure of his plans to comply with the Final Order. On September 25, 2024, and October 08, 2024, Investigator DesMarais reached back out to Counsel to obtain an update, but did not receive a reply.

On or about October 17, 2024, Respondent contacted Investigator DesMarais directly to advise that he had closed his local practice and was “looking for a new job.” Per Respondent, once he received a “new medical license” in another state he would notify her. Respondent’s correspondence did not address PHP enrollment or the Board’s Final Order.

On October 21, 2024, Investigator DesMarais forwarded Respondent’s email to Counsel and inquired as to whether she was still serving as his legal representative, to which Counsel replied the same date that she was and asked Investigator DesMarais for guidance regarding PHP enrollment. On October 22, 2024, Investigator DesMarais replied to advise that Respondent either needed to enroll in his home state’s PHP and have them send Arizona quarterly reports, or he needed to complete PHP enrollment in Arizona while he traveled. Investigator DesMarais also advised Counsel that Respondent had yet to renew License No. 42688 or tender payment for the civil penalty assessed in Case No. 24A-42688-MDX.

On October 24, 2024, Investigator DesMarais again inquired with Counsel as to whether Respondent enrolled in PHP monitoring, as required by the Final Order.

On October 29, 2024, Investigator DesMarais advised Counsel that Respondent had until the end of the day to enroll in PHP monitoring, or she would have to start the process to issue a practice restriction due Respondent’s to non-compliance.

On October 30, 2024, the Board’s Deputy Director, Raquel Rivera (“Deputy Director Rivera”) issued correspondence to Counsel to advise that regardless of Respondent’s residency, as long as he maintained an Arizona medical license he would remain under the terms of the Final Order; including PHP enrollment, which became effective October 15, 2024. Counsel was further advised that if Respondent did not complete PHP by the end of that date, the Board would open a new case for his alleged violation of the Final Order, which would likely impact his ability to become licensed in another state. Per Deputy Director Rivera, Respondent could enroll in PHP in Arizona, and then transfer his monitoring to another state post licensure there, or surrender his license until PHP enrollment was confirmed.

On November 01, 2024, the Board issued a Notice Letter to Respondent under Ariz. Rev. Stat. § 32-1401(27)(s) for his failure to comply with the terms of the Final Order.

On November 07, 2024, the Board issued Respondent an Interim Consent Agreement for Practice Restriction (“Consent Agreement”), which was required to be signed and returned no later than November 11, 2024.

On November 11, 2024, Counsel advised Investigator DesMarais and Deputy Director Rivera that Respondent would not comply with the “onerous requirements” of the Final Order, and requested a Voluntary Surrender agreement for review.

On November 12, 2024, Deputy Director Rivera advised Counsel that the Board would draft a Voluntary Surrender agreement for Respondent, but that it would be considered a disciplinary surrender, and that he would still have to sign the Consent Agreement or the Board would take summary action.

On November 13, 2024, Counsel informed Investigator DesMarais that Respondent wished to “fully surrender” his medical license, to which Investigator DesMarais replied that it could not be done until the Board approved it, and that the Board could not do so until its scheduled meeting the following month. Counsel advised Investigator DesMarais that Respondent refused to sign the Consent Agreement.

On November 14, 2024, Investigator DesMarais provided Counsel with an Order for Surrender of License and Consent to the Same (“Order for Surrender”) for Respondent.

On November 15, 2024, Counsel asked Investigator DesMarais if the factual findings in the proposed Order for Surrender could be modified. On November 18, 2024, Investigator DesMarais asked Counsel for her proposed changes.

Later on November 18, 2024, Investigator DesMarais received a Withdrawal of Representation notice from Counsel that stated she no longer served as Respondent’s legal representative. Investigator DesMarais immediately contacted Respondent to inquire as to whether he had retained new legal counsel, and if he could supply the Board with the factual finding modifications Counsel had previously mentioned he was interested in obtaining from the Board.

On November 19, 2024, Respondent informed Investigator DesMarais that he had not retained a new attorney for his pending action with the Board, and reiterated that would not sign the Order for Surrender.

Proposed modifications to the factual findings in the Board’s proposed Order for Surrender were never received by the Board from or on behalf of Respondent.

Additional Evidence

On or about December 30, 2024, the Board received the following correspondence from Respondent:

I have received a copy of the Complainant and Notice of Hearing. I object to the formal hearing before a judge. I am not represented by a lawyer, as you know, and I do not have the funds to hire one. I choose to have the Board hear the charge against me through a hearing before the Board. In answer to the Complaint, as you know ow, it is my opposition that the board’s members and Board staff discriminated against me because of my race and in violation of the laws against disability discrimination. As you know, the action of the Biard made it impossible for me to continue to practice in Arizona, and I offered to surrender my license because of that, but the Board demanded I sign a document admitting I deserved the discipline ordered by the Board, which I could not do. I deny that I refused to sign up for PHP. There is no justification for requiring me to pay the thousands of dollars to be in that program when I am not, will not, be practicing medicine. This new Charge is just more discrimination and retaliation against me for asserting my rights. I assume and expect that you will deliver a copy of this response to the Administrative Law Judge.

(All errors in original.)

Closing Arguments

In closing, the Board argued that although Respondent was represented by an attorney from September 09, 2024, to October 15, 2024, he failed to comply with the Board’s Final Order to enroll in a PHP Monitoring Program, and failed to appeal by timely requesting review or rehearing. Though given a second chance by the Board in 24A-42688-MDX, Respondent continued to evince his inability or unwillingness to submit to the Board’s regulation of his privilege to practice medicine in the State of Arizona. Per the Board, Respondent’s refusal to sign the Consent Agreement or Order for Surrender also evinced that he was unsafe to practice, which placed the public at risk in violation of Ariz. Rev. Stat. § 32-1401(27)(s). Thus, the Board beseeched the Tribunal to affirm the imposed summary suspension and asked that an Order be issued recommending the revocation of Respondent’s license. The Board also asked that the Order include a provision assessing Respondent the cost of the formal hearing incurred by the Board pursuant to Ariz. Rev. Stat. § 32-1451(M).

CONCLUSION OF LAW

The Arizona Legislature created the Board to protect the public and those who deal with its licensed practitioners. The Board has a legitimate interest in protecting the public. The Board is the duly constituted authority for licensing and regulating the practice of allopathic medicine. Therefore, the Board has jurisdiction over Respondent and the subject matter in this case. This matter has been properly brought before OAH for adjudication.

The Complaint the Board mailed to Respondent’s address of record is sufficient, and Respondent is deemed to have received notice of the hearing in this matter. Because the Board mailed all correspondence to Respondent in the same manner and failed to receive any mail returned as undeliverable, Respondent is deemed to have received all correspondence regarding this matter from the Board as well.

The Board bears the burden of proof to establish cause to sanction Respondent’s license to practice allopathic medicine and factors in aggravation of the penalty by clear and convincing evidence. Respondent bears the burden to establish affirmative defenses and factors in mitigation of the penalty by the same evidentiary standard. The standard of proof is by clear and convincing evidence. Clear and convincing evidence is “[e]vidence indicating that the thing to be proved is highly probable or reasonably certain.”

Ariz. Rev. Stat. § 32-1451(D) provides that “[i]f the board finds, based on the information it receives under subsections A and B of this section, that the public health, safety or welfare imperatively requires emergency action, and incorporates a finding to that effect in its order, the board may restrict a license or order a summary suspension of a license pending proceedings for revocation or other action. If the board takes action pursuant to this subsection, it shall also serve the licensee with a written notice that states the charges and that the licensee is entitled to a formal hearing before the board or an administrative law judge within sixty days.”

Ariz. Rev. Stat. § 32-1451(M) provides that “[a]ny doctor of medicine who after a formal hearing is found by the board to be guilty of unprofessional conduct, to be mentally or physically unable safely to engage in the practice of medicine or to be medically incompetent is subject to censure, probation as provided in this section, suspension of license or revocation of license or any combination of these, including a stay of action, and for a period of time or permanently and under conditions as the board deems appropriate for the protection of the public health and safety and just in the circumstance. The board may charge the costs of formal hearings to the licensee who it finds to be in violation of this chapter.”

Ariz. Rev. Stat. § 32-1451(U) provides, for the purposes of determining the appropriate disciplinary action under this section, that “[t]he board shall consider all previous non-disciplinary and disciplinary actions against a licensee.”

Ariz. Rev. Stat. § 32-1401(27)(s) defines “unprofessional conduct” to include, “[v]iolating a formal order, probation, consent agreement or stipulation issued or entered into by the board of its executive director.”

The issue in this matter was whether Respondent engaged in acts of unprofessional conduct, and if so, whether grounds existed for the Board to discipline Respondent’s license based on said conduct.

The substantive facts in this matter are clear.

Here, the Board established by clear and convincing evidence that Respondent engaged in unprofessional conduct. Specifically, although it was recommended that Respondent’s medical license be revoked, the Board voted instead to issue a Decree of Censure to Respondent, which placed License No. 42688 on a 5-year probationary term whereby Respondent was required to enroll in PHP Monitoring. It is also clear from the record that Respondent never appealed the Final Order or complied.

Therefore, the sole remaining issue to be addressed was whether Respondent established one or more affirmative defenses or mitigating factors, and if so, whether those defenses or mitigating factors preclude the Board from disciplining Respondent’s license.

While Respondent had no obligation to testify, he did not present any evidence sufficient to overcome the credible evidence submitted by the Board. Nor was Respondent able to successfully rebut or refute any of the evidence in aggravation presented by the Board against him. Notably, though Respondent vehemently argued in his December 30, 2024, reply to the Complaint that he had been discriminated against and that his rights had been violated by the Board wherein he, he offered no authority by which one or more instances could be substantiated as such. What the record reflects, is that Respondent was not entitled to more notice than was provided or any special accommodations beyond the grace that had already been extended by the Board. Additionally, Respondent could not “waive” an administrative hearing in favor of having the Board adjudicate the current action.

A license to practice medicine is an esteemed privilege, not an inherent property right. The primary duties of a licensed physician included to ensure that they are safe to practice and to work with the Board to ensure their welfare and that of their patients. To effectuate appropriate regulatory compliance, physicians must communicate clearly, accurately, and professionally with Board staff. It is clear from a review of the evidentiary record in this matter that Respondent repeatedly failed to meet these rudimentary standards to practice medicine.

In the case at bar, the Tribunal finds that Respondent’s conduct established that he cannot, and does not want to be, regulated by the Board at this time.

Based on the credible evidenced of record, the undersigned Administrative Law Judge must conclude that the Board’s allegations of unprofessional conduct pursuant to Ariz. Rev. Stat. § 32-1401(27)(s) against Respondent have been established. Ground exist for the Board to impose a disciplinary sanction against Respondent’s license to practice allopathic medicine in the State of Arizona.

RECOMMENDED ORDER

Based on the foregoing,

IT IS ORDERED that the Board’s November 25, 2024, Order for Summary Suspension of License against Respondent’s License No. 42668 be affirmed.

IT IS FURTHER ORDERED that Respondent’s License No. 42668 for the practice of allopathic medicine in the State of Arizona be revoked.

IT IS FURTHER ORDERED that Respondent be assessed the cost(s) of formal hearing incurred by the Board in this matter per Ariz. Rev. Stat. § 32-1451(M).

NOTICE

In the event of certification of the Administrative Law Judge Decision by the Director of the Office of Administrative Hearings, the effective date of the Order will be five days from the date of that certification.

Done this day, January 28, 2025.

Office of Administrative Hearings

/s/ Jenna Clark

Administrative Law Judge

Transmitted electronically to:

Patricia E. McSorley, Executive Director

Arizona Medical Board

Seth Hargraves, Esq., Assistant Attorney General

Office of the Attorney General – SGD/LES

2005 N. Central Ave.

Phoenix, AZ 85004

[email redacted]

Charles E. Kelly, Respondent

4387 Pinto Rd.

Kingman, AZ 86401

[email redacted]

By: OAH Staff