The doctors worked in the hospital's maternity unit
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Two Polish doctors are seeking £250,000 each in damages over a letter sent out after their contracts were terminated.
Michal Samberger and Kazimierz Dabek lost their jobs within weeks of being recruited to Caithness General in Wick two years ago.
A senior Scottish Executive officer sent out a letter advising potential employers to contact Highland Health Board before offering them work.
The consultants have now raised an action at the Court of Session.
Doctors Samberger and Dabek say that their professional reputations have been seriously undermined and they were unable to secure employment as doctors in Britain.
They have raised a judicial review of a decision by Scottish ministers to issue the alert letter which was to advise potential future employers to contact Highland Health Board before offering them work.
They are seeking to have the decision overturned and each is claiming £250,000 in the action at the Court of Session in Edinburgh.
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This is plainly an unusually complex judicial review
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The doctors, from Lublin, in Poland, were recruited to work as locum consultants at Caithness General Hospital in Wick in June 2004.
However, within weeks their contracts were ended and the health board sent out a press release which referred to "very real concerns about the standards of clinical practice of both these locum doctors".
The senior medical officer at the Scottish Executive health department, Dr Robin Cairncross, later issued the letter which it is said was "widely disseminated".
Patient safety
The Polish doctors said in their pleadings that they refuted any allegation of poor clinical practice or incompetence.
Both maintain that the General Medical Council later informed them there was no evidence that patient safety had been compromised.
Also, that no patients had complained and no action was to be taken against them.
The doctors have raised a judicial review
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Dr Samberger,56, said that during his short time working at the Wick hospital he managed the deliveries of about 10 babies, including four Caesarean sections.
He said he also carried out a number of minor gynaecological operations without complications or complaints from patients.
Both doctors claim that the decision by Highland Health Board to terminate their contracts was based on "inadequate scrutiny" of the facts and allegations.
They also maintain that in deciding to issue the alert letter the Scottish ministers acted unreasonably and in error of law.
'Free movement'
During a brief hearing, Aidan O'Neill QC, for the doctors, said he faced a challenge on the competency of the proceedings from the health board and over delay in bringing the letter under review.
He also said that European community law may come into play and added: "These petitioners are exercising free movement rights."
Both the health board and the Scottish Executive were represented at a brief hearing before Lord Reed who allowed the parties time to adjust pleadings in the case.
The judge said: "This is plainly an unusually complex judicial review."