A registered nurse hired into a Sioux Falls hospital's intensive care unit in 2014 was the subject of a routine controlled-substance surveillance report in March 2016. The hospital's automated dispensing cabinet logs each withdrawal, and staff must scan or document administration and waste. The report showed the nurse had removed fentanyl at an atypically high rate compared with coworkers between March 2015 and March 2016.
A review committee made up of the nurse manager, a pharmacist and another nurse examined 16 patient charts and listed 12 areas of concern. They could not account for small quantities of fentanyl, lorazepam and hydromorphone, and found that 66 of 669 medications had not been scanned to show administration or waste. The hospital noted that scanning errors alone would not be alarming, but the concentration of errors involving fentanyl raised a red flag.
At a meeting on March 28, 2016 the nurse was shown the findings and denied any wrongdoing. A state Division of Criminal Investigation agent interviewed her the same day, during which she denied using, selling or diverting narcotics, and she submitted to a urinalysis that she reported came back negative. The hospital terminated her employment that day, citing documentation errors and her inability to account for the medications, and then reported suspected diversion to the Board of Nursing, Department of Health, DEA and Board of Pharmacy. The Board of Nursing issued a confidential letter of concern and required counseling and remedial education; the other agencies took no action.
The nurse sued the hospital in 2017 for wrongful discharge, breach of contract, defamation and emotional distress. The circuit court granted summary judgment to the hospital, and on June 17, 2020 the South Dakota Supreme Court affirmed, holding that she was an at-will employee, that the hospital's controlled-substance policy did not create a for-cause requirement, and that its reports of suspected diversion to interested agencies were privileged absent evidence of malice. The court declined to create a public-policy exception for terminations based on unsubstantiated criminal accusations.