Bochkis v. Med. Justice Servs., Inc.

2016 NCBC 89

• Court: North Carolina Business Court
• Decided: November 23, 2016
• Docket: 16-CVS-6434
• Status: Published

Opinion

Bochkis v. Med. Justice Servs., Inc., 2016 NCBC 89.

STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE SUPERIOR COURT DIVISION COUNTY OF GUILFORD 16 CVS 6434

MARK BOCHKIS, ) ) Plaintiff, ) ) v. ) ORDER AND OPINION ON ) DEFENDANT’S MOTION TO DISMISS MEDICAL JUSTICE SERVICES, ) AND MOTION TO STRIKE INC., ) ) Defendant. ) )

1. THIS MATTER is before the Court upon Defendant Medical Justice

Services, Inc.’s (“Defendant”) Motion to Dismiss Plaintiff’s Second Claim for Relief

(the “Motion to Dismiss”) pursuant to Rule 12(b)(6) of the North Carolina Rules of

Civil Procedure (“Rule(s)”) and Motion to Strike (the “Motion to Strike”) (collectively

the “Motions”) pursuant to Rule 12(f) filed August 26, 2016 in the above-captioned

case. For the reasons stated below, the Court hereby GRANTS the Motion to Dismiss

without prejudice and DENIES the Motion to Strike.

Fitzgerald Litigation, by Andrew L. Fitzgerald and D. Stuart Punger, Jr., for Plaintiff Mark Bochkis.

Ogletree, Deakins, Nash, Smoak & Stewart, by Regina W. Calabro and Jennifer Cotner, for Defendant Medical Justice Services, Inc.

Robinson, Judge.

I. INTRODUCTION

2. This lawsuit arises out of Plaintiff’s contention that Defendant has

wrongfully sought to enforce an employment agreement containing unenforceable non-competition and non-disclosure provisions. Plaintiff seeks a declaratory

judgment that the restrictive covenants in the employment agreement are

unenforceable, that the agreement does not prohibit Plaintiff’s employment with

prospective employer COCG, and that Defendant’s alleged actions have improperly

restrained Plaintiff’s ability to secure gainful employment. Plaintiff also asserts a

claim for wrongful interference with prospective contract.

3. The Motion to Dismiss seeks dismissal pursuant to Rule 12(b)(6) only of

Plaintiff’s second claim for wrongful interference with prospective contract and does

so on two grounds; first, that Plaintiff has not alleged facts sufficient to show the

elements of the claim, and second, that Defendant has immunity from this claim

pursuant to North Carolina’s Job Reference Shield Law, N.C. Gen. Stat. § 1-539.12.

The Motion to Strike seeks an order striking paragraphs 11 and 22 of the Complaint

pursuant to Rule 12(f) on the basis that Plaintiff inappropriately refers to settlement

negotiations and irrelevant material.

4. Although the Court concludes that Defendant is not immune from civil

liability under N.C. Gen. Stat. § 1-539.12, the Court concludes that Plaintiff has failed

to allege facts sufficient to state a claim for wrongful interference with prospective

contract. Accordingly, the Court concludes that Defendant’s Motion to Dismiss

should be granted.

5. As to the Motion to Strike, the Court concludes in its discretion that none

of the allegations in the Complaint that Defendant seeks to have stricken are clearly irrelevant or improper. Accordingly, the Court concludes that Defendant’s Motion to

Strike should be denied.

II. PROCEDURAL HISTORY

6. Plaintiff Mark Bochkis (“Plaintiff”) initiated this action on July 22, 2016 by

filing a Verified Complaint for Declaratory Judgment and Other Relief (the

“Complaint”) in Guilford County Superior Court.

7. Also on July 22, 2016, Plaintiff filed a Notice of Designation of Action as a

Mandatory Complex Business Case. By order dated July 25, 2016, the Chief Justice

of the Supreme Court of North Carolina assigned the case to Chief Business Court

Judge Gale to determine whether the action met the designation requirements of a

mandatory complex business case in accord with N.C. Gen. Stat. § 7A-45.4.

8. By Order dated August 9, 2016, Chief Judge Gale concluded that

designation of this case as a mandatory complex business case was appropriate, and

assigned this case to the undersigned.

9. On August 26, 2016, Defendant filed the Motions.

10. The Motions were fully briefed, and the Court held a hearing on the Motions

on November 2, 2016. The Motions are ripe for resolution.

III. FACTUAL BACKGROUND

11. The Court does not make findings of fact on a motion to dismiss under Rule

12(b)(6), but only recites those facts included in the Complaint that are relevant to

the Court’s determination of the Motion. See, e.g., Concrete Serv. Corp. v. Investors

Grp., Inc., 79 N.C. App. 678, 681, 340 S.E.2d 755, 758 (1986). 12. Plaintiff is a citizen and resident of Guilford County, North Carolina.

(Compl. ¶ 1.)

13. Defendant is a North Carolina corporation with its principal place of

business in Guilford County, North Carolina. (Compl. ¶ 2.) Jeff Segal (“Mr. Segal”)

is Defendant’s Chief Executive Officer. (Compl. ¶ 2.)

14. Defendant employed Plaintiff from February 27, 2013 until June 30, 2016.

(Compl. ¶ 4.) While employed by Defendant, Plaintiff served as a communications

manager for its “eMerit service.” (Compl. ¶ 5.)

15. At the commencement of his employment with Defendant, Plaintiff signed

a Confidential Information and Inventions Agreement/Restrictive Covenant/Non-

Disparagement Agreement (the “Agreement”). (Compl. ¶ 6; Compl. Ex. A.) The

Agreement contained, among other things, non-competition and non-disclosure

covenants. (Compl. Ex. A ¶¶ 2, 9.)

16. During his employment with Defendant, Plaintiff researched and spoke

with potential “partners” with whom Defendant sought to do business. (Compl. ¶ 7.)

One such prospective partner was Healthgrades Operating Company, Inc.

(“Healthgrades”), a company located in Denver, Colorado. (Compl. ¶ 7.) The

employees at Healthgrades with whom Plaintiff interacted were all based in Denver.

17. During his employment with Defendant, Plaintiff began to consider job

opportunities with other companies. (Compl. ¶ 8.) A potential opportunity arose with

COCG, a company owned by Healthgrades and located in Raleigh, North Carolina.

(Compl. ¶ 8.) 18. COCG is a digital marketing company that handles marketing efforts for

Healthgrade’s hospital clients. (Compl. ¶ 8.) Plaintiff applied to be employed by

COCG as a copywriter. (Compl. ¶ 8.)

19. Eventually, an employee of Healthgrades contacted Defendant to verify

Plaintiff’s employment. (Compl. ¶ 10.) At that time, an employee of Defendant told

the Healthgrades representative that Plaintiff was restricted by a non-compete that

would apply to his new proposed position with COCG. (Compl. ¶ 10.)

20. Defendant terminated Plaintiff on June 30, 2016. (Compl. ¶ 11.)

Defendant, through counsel, has indicated that it will sue Plaintiff to prevent him

from taking the position offered by COCG. (Compl. ¶ 14; see Compl. Ex. B.)

21. As a result of Defendant’s expressed position with respect to the Agreement,

Healthgrades has indicated to Plaintiff that a job offer to him would be contingent on

confirmation from Defendant or a court order indicating that the Agreement does not

prevent Plaintiff’s employment with COCG. (Compl. ¶ 13.)

22. Caught between the positions with his former employer, Defendant, and his

prospective employer, COCG, Plaintiff has been left without a job or means of income

and has filed this action seeking a declaratory judgment that Plaintiff is not

prohibited by the Agreement from working for COCG as well as monetary damages

for Defendant’s alleged wrongful interference with Plaintiff’s prospective contract

with COCG. (Compl. ¶ 16.) IV. LEGAL STANDARD

23. In ruling on a motion to dismiss pursuant to Rule 12(b)(6), the Court

construes the Complaint liberally and reviews the allegations of the Complaint in the

light most favorable to Plaintiff. See Laster v. Francis, 199 N.C. App. 572, 577, 681

S.E.2d 858, 862 (2009). The Court’s inquiry is “whether, as a matter of law, the

allegations of the complaint, treated as true, are sufficient to state a claim upon which

relief may be granted under some legal theory.” Harris v. NCNB Nat’l Bank, 85 N.C.

App. 669, 670, 355 S.E.2d 838, 840 (1987).

24. Dismissal of a claim pursuant to Rule 12(b)(6) is proper “(1) when the

complaint on its face reveals that no law supports plaintiff’s claim; (2) when the

complaint reveals on its face the absence of fact sufficient to make a good claim; [or]

(3) when some fact disclosed in the complaint necessarily defeats the plaintiff’s

claim.” Oates v. JAG, Inc., 314 N.C. 276, 278, 333 S.E.2d 222, 224 (1985); see also

Jackson v. Bumgardner, 318 N.C. 172, 175, 347 S.E.2d 743, 745 (1986). Otherwise,

“a complaint should not be dismissed for insufficiency unless it appears to a certainty

that plaintiff is entitled to no relief under any state of facts which could be proved in

support of the claim.” Sutton v. Duke, 277 N.C. 94, 103, 176 S.E.2d 161, 166 (1970)

(emphasis omitted).

25. The Court is not required “to accept as true allegations that are merely

conclusory, unwarranted deductions of fact, or unreasonable inferences.” Good Hope

Hosp., Inc. v. N.C. Dep’t of Health & Human Servs., 174 N.C. App. 266, 274, 620

S.E.2d 873, 880 (2005). The Court can also ignore a party’s legal conclusions set forth in its pleading. McCrann v. Pinehurst, LLC, 225 N.C. App. 368, 377, 737 S.E.2d 771,

777 (2013).

26. With respect to the Motion to Strike, Rule 12(f) provides that the Court may

“order stricken from any pleading . . . any redundant, irrelevant, immaterial,

impertinent, or scandalous matter.” N.C. Gen. Stat. § 1A-1, Rule 12(f). “Rule 12(f)

motions are addressed to the sound discretion of the trial court” and “[m]atter should

not be stricken unless it has no possible bearing upon the litigation. If there is any

question as to whether an issue may arise, the motion [to strike] should be denied.”

Reese v. City of Charlotte, 196 N.C. App. 557, 567, 676 S.E.2d 493, 499 (2009)

(internal citations and quotation marks omitted).

V. ANALYSIS

27. The Motion to Dismiss seeks dismissal pursuant to Rule 12(b)(6) of

Plaintiff’s Second Claim for Relief for Wrongful Interference with Prospective

Contract on the basis that Plaintiff has not alleged facts sufficient to show the

elements of the claim, and that Defendant has immunity from this claim pursuant to

North Carolina’s Job Reference Shield Law, N.C. Gen. Stat. § 1-539.12. Defendant’s

Motion to Strike seeks to have stricken two paragraphs of the Complaint pursuant to

Rule 12(f) on the basis that Plaintiff inappropriately refers to settlement negotiations

and irrelevant material.

A. Motion to Dismiss

28. To state a claim for wrongful interference with prospective contract, a

plaintiff must allege that the defendant “interfere[d] with a business relationship ‘by maliciously inducing a person not to enter into a contract with a third person, which

he would have entered into but for the interference, . . . if damage proximately ensues,

when this interference is done not in the legitimate exercise of the interfering person’s

rights.’” Beverage Sys. of the Carolinas, LLC v. Associated Bev. Repair, LLC, 368

N.C. 693, 701, 784 S.E.2d 457, 463 (2016) (quoting Spartan Equip. Co. v. Air

Placement Equip. Co., 263 N.C. 549, 559, 140 S.E.2d 3, 11 (1965)). “[A] plaintiff must

produce evidence that a contract would have resulted but for a defendant’s malicious

intervention.” Id.

29. Defendant argues that Plaintiff has failed to allege that Defendant induced

Healthgrades to not enter into a contract with Plaintiff. In support of its argument,

Defendant attaches to its Motion to Dismiss an affidavit of Defendant’s Chief

Executive Officer, Mr. Segal. Attached to Mr. Segal’s affidavit as Exhibit 1 is an e-

mail from a Healthgrades employee to Defendant. “[W]hen ruling on a Rule 12(b)(6)

motion, a court may properly consider documents which are the subject of a plaintiff’s

complaint and to which the complaint specifically refers even though they are

presented by the defendant.” Oberlin Capital, LP v. Slavin, 147 N.C. App. 52, 60

(2001). Defendant thus asserts that the Court can, and should, consider this e-mail

in ruling on Defendant’s Motion to Dismiss.

30. Specifically, Defendant contends that this e-mail is referenced in

paragraphs 10 and 21 of the Complaint. Paragraph 10 of the Complaint alleges that

“[a]n employee of Healthgrades contacted [Defendant] to verify [Plaintiff’s]

employment. At the time, an employee of [Defendant] specifically told the Healthgrades representative that [Plaintiff] was restricted by a non-compete that

would apply to his new proposed position with COCG.” Paragraph 21 of the

Complaint alleges that “[Defendant], through [Mr. Segal], acted maliciously and

without justification in wrongfully telling Healthgrades that [Plaintiff] was

prevented by contract from taking a job with COCG.”

31. Despite Defendant’s contention that “[t]he crux of Plaintiff’s claim is the e-

mail Segal sent to Healthgrades,” (Def.’s Br. Supp. Mot. Dismiss 6), the e-mail that

Defendant relies on is not specifically referred to in these two paragraphs, or

anywhere else in Plaintiff’s Complaint. An allegation of some communication

between Defendant and Healthgrades is not a specific reference to a specific e-mail.

Indeed, Plaintiff’s counsel represented to the Court at the hearing on the Motions

that Plaintiff was not, at the time of the filing of the Complaint, aware of the existence

of the specific e-mail on which Defendant relies. Without a specific reference in the

Complaint to the document that Defendant relies on, the Court concludes that it

cannot consider the document in resolving Defendant’s Motion to Dismiss under Rule

12(b)(6).

32. Nonetheless, even without considering the e-mail relied on by Defendant,

the Court concludes that Plaintiff has failed to allege facts sufficient to state a claim

for wrongful interference with prospective contract. In relevant part, Plaintiff alleges

that:

 Plaintiff, while employed by Defendant, served as a communications

manager for Defendant’s “eMerit service,” (Compl. ¶ 5);  Healthgrades was a prospective partner with which Defendant

sought to do business, (Compl. ¶ 7);

 COCG is a digital marketing company owned by Healthgrades that

handles marketing efforts for Healthgrade’s hospital clients, (Compl.

¶ 8);

 Healthgrades indicated to Plaintiff its intention to extend to him an

offer of employment for the position at COCG, (Compl. ¶ 9);

 Plaintiff applied to be a copyrighter at COCG, (Compl. ¶ 8);

 The individuals at COCG with whom Plaintiff would interact, and

the subject matter of his prospective job, were distinct from his

relationships and role with Defendant, (Compl. ¶ 8);

 An employee of Healthgrades contacted Defendant to verify

Plaintiff’s employment and, at that time, an employee of Defendant

specifically told Healthgrades that Plaintiff was restricted by a non-

compete that would apply to his new proposed position with COCG,

(Compl. ¶ 10);

 As a result of Defendant’s actions, Healthgrades subsequently

indicated to Plaintiff that a job offer would be contingent on

confirmation from Defendant, or a court order, indicating that the

Agreement did not prohibit Plaintiff’s employment with COCG,

(Compl. ¶ 13);  Defendant has indicated that it will sue Plaintiff to prevent him from

taking the position that he had been offered with COCG, (Compl. ¶

14);

 Defendant has asserted that Healthgrades’ intent in hiring Plaintiff

is based on its desire to learn more about Defendant’s business

practices and other confidential information protected by the

Agreement, and that COCG’s employment of Defendant would

inevitably lead to the disclosure of protected trade secrets and other

confidential information, (Compl. ¶ 15); and

 Plaintiff has been left without a job or means of income as a result of

Defendant’s actions, (Compl. ¶ 16).

33. Defendant argues that it was justified in engaging in any interference with

Plaintiff’s prospective employment because Defendant was acting to protect its

legitimate business interests. Indeed, “even where there is actual interference, a

motion to dismiss should be granted where the interference is justified or privileged.”

Cobra Capital LLC v. RF Nitro Communs., Inc., 266 F. Supp. 2d 432, 439 (M.D.N.C.

2002) (citing Peoples Sec. Life Ins. Co. v. Hooks, 322 N.C. 216, 220, 367 S.E.2d 647

(1988)). A plaintiff must allege that the defendant “acted with malice and for a reason

not reasonably related to the protection of a legitimate business interest.” Id.

(quoting Smith v. Ford Motor Co., 289 N.C. 71, 94, 221 S.E.2d 282 (1976)). “[T]he

complaint must admit of no motive for interference other than malice.” Filmar

Racing, Inc. v. Stewart, 141 N.C. App. 668, 674, 541 S.E.2d 733, 738 (2001). 34. Here, although Plaintiff makes conclusory allegations that Defendant

“acted maliciously and without justification in wrongfully telling Healthgrades that

[Plaintiff] was prevented by contract from taking a job with COCG,” these conclusory

allegations are not sufficient to withstand dismissal. See Charlotte Motor Speedway,

LLC v. Cnty. of Cabarrus, 230 N.C. App. 1, 6, 748 S.E.2d 171, 175 (2013) (legal

conclusions in a complaint are not entitled to a presumption of validity under Rule

12(b)(6)).

35. Moreover, Plaintiff’s Complaint admits of a motive for Defendant’s

interference other than malice. Plaintiff has alleged that Healthgrades and

Defendant were potential “partners” and that Defendant’s alleged interference was

as a result of Defendant’s concern that Healthgrades was interested in acquiring the

trade secrets and other confidential information of Defendant. These allegations, if

true, make any interference by Defendant justified as a matter of law. See, e.g.,

Hooks, 322 N.C. at 221, 367 S.E.2d at 650 (“[C]ompetition in business constitutes

justifiable interference in another’s business relations and is not actionable so long

as it is carried on in furtherance of one’s own interests and by means that are

lawful.”); Reichold Chems., Inc. v. Goel, 146 N.C. App. 137, 151, 555 S.E.2d 281, 290

(2001) (stating that a trade secret owner will not be liable for tortious interference by

seeking to legitimately protect its legal rights).

36. Accordingly, the Court concludes that Plaintiff’s Complaint admits of a

motive for Defendant’s alleged interference other than malice and, therefore, that

Plaintiff has failed to sufficiently allege a claim for wrongful interference with prospective contract. The Court thus concludes that the Motion to Dismiss should be

granted.

37. The Court concludes, however, that dismissal of Plaintiff’s Second Claim

for Relief should be without prejudice. “The decision to dismiss an action with or

without prejudice is in the discretion of the trial court . . . .” First Fed. Bank v.

Aldridge, 230 N.C. App. 187, 191, 749 S.E.2d 289, 292 (2013). Although the Court

concludes that Plaintiff has not alleged facts sufficient to state a claim for wrongful

interference with prospective contract, it is not clear to the Court that evidence

supporting such a claim will not be uncovered through discovery in connection with

Plaintiff’s claim for declaratory judgment. Thus, the Court concludes, in the exercise

of its discretion, that dismissal of Plaintiff’s claim should be without prejudice to

Plaintiff’s right to seek leave to reassert such a claim by way of a motion to amend

his Complaint in the event discovery uncovers new facts sufficient to establish the

elements of a claim for wrongful interference.

38. Defendant also argues as another basis for dismissal of Plaintiff’s wrongful

interference claim that it is immune from liability for wrongful interference with

prospective contract pursuant to N.C. Gen. Stat. § 1-539.12. The Court concludes

that section 1-539.12 is not a separate basis for dismissal at this stage of the

proceeding.

39. N.C. Gen. Stat. § 1-539.12 provides that “[a]n employer who discloses

information about a current or former employee’s job history or job performance to a

prospective employer of the current or former employee upon request of the prospective employer . . . is immune from civil liability and is not liable in civil

damages for the disclosure or any consequences of the disclosure.” N.C. Gen. Stat. §

1-539.12(a). Defendant argues that it provided Healthgrades with information

regarding Plaintiff’s job history upon Healthgrades’ request and that, as such,

Defendant is immune from any liability for the disclosure.

40. Section 1-539.12(b) defines “job performance,” but does not define “job

history.” The Court is not convinced that a communication from Defendant to

Healthgrades that Plaintiff is bound by a non-compete in response to a request to

verify Plaintiff’s employment constitutes “job performance” or “job history” under

section 1-539.12(b). Plaintiff’s claim, however, is based on more than that

communication. For example, Plaintiff also alleges that Defendant advised that it

will sue Plaintiff to prevent him from taking the position that he was offered with

COCG. Without further development of the factual record, the Court is not prepared

to dismiss Plaintiff’s claim at this stage on the additional basis of immunity from civil

liability under section 1-539.12.

41. Nonetheless, as explained above, the Court concludes that Plaintiff’s claim

for wrongful interference with prospective contract should be dismissed without

prejudice.

B. Motion to Strike

42. Finally, Defendant requests that the Court strike paragraphs 11 and 22 of

the Complaint, pursuant to Rule 12(f). 43. Defendant contends that paragraphs 11 and 22 contain a reference to a

settlement offer by Defendant in violation of North Carolina Rule of Evidence 408.

Even assuming that alleging a fact, evidence of which would be inadmissible at trial,

is properly struck under Rule 12(f), it is not clear to the Court at this stage that either

paragraph 11 or 22 refers to evidence that would be inadmissible under Rule of

Evidence 408. The Court thus, in the exercise of its discretion, denies Defendant’s

Motion to Strike on this basis.

44. Defendant also argues that the allegation made in the last sentence of

paragraph 11, that Mr. Segal holds a law degree, is irrelevant and should thus be

stricken. Again, it is not clear to the Court at this stage that such an allegation is

irrelevant. Therefore, the Court, in the exercise of its discretion, also denies

Defendant’s Motion to Strike on this basis. See Reese, 196 N.C. App. at 567, 676

S.E.2d at 499 (“Matter should not be stricken unless it has no possible bearing upon

the litigation.”).

VI. CONCLUSION

45. For the foregoing reasons, the Court hereby GRANTS Defendant’s Motion

to Dismiss without prejudice and DENIES the Motion to Strike.

SO ORDERED, this the 23rd day of November, 2016.

/s/ Michael L. Robinson Michael L. Robinson Special Superior Court Judge for Complex Business Cases