Stewart, R. v. Nicosia, G.

Opinion

J-A30010-18

NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

DR. ROGER STEWART : IN THE SUPERIOR COURT OF : PENNSYLVANIA

Appellant :

:

:

v. :

:

:

DR. GREGORY NICOSIA : No. 45 WDA 2018 INDIVIDUALLY; AND DR. GREGORY : NICOSIA PARTNER TRADING AS : ADVANCED DIAGNOSTICS; AND : ADVANCED DIAGNOSTICS, INC. :

Appeal from the Judgment Entered December 5, 2017 In the Court of Common Pleas of Allegheny County Civil Division at No(s): GD-01-013980,

GD-01-014628

BEFORE: SHOGAN, J., KUNSELMAN, J., and STRASSBURGER*, J. MEMORANDUM BY SHOGAN, J.: FILED APRIL 15, 2019 Appellant, Dr. Roger Stewart, appeals from the judgment entered December 5, 2017, in the Court of Common Pleas of Allegheny County. After careful review, we affirm.

This complex litigation has a lengthy procedural history. This case stems from disagreements regarding a chiropractic business involving two former friends. Appellant is a licensed chiropractor. Dr. Gregory Nicosia (“Nicosia”) is a psychologist without a chiropractic license. The two formed a business wherein Appellant provided chiropractic treatments to the public and supervised staff, while Nicosia managed the money for the business. On

July 17, 2001, Appellant sued Nicosia at docket number GD-01-013980

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* Retired Senior Judge assigned to the Superior Court.

J-A30010-18

(Equity) for: 1) a declaration of partnership between the two men as to the chiropractic business; 2) an accounting of the financial activity of the chiropractic business on a year-by-year basis; and 3) a receiver for chiropractic assets.

On July 24, 2001, Appellant sued Nicosia at docket number GD-01-

014628 (Law) for 1) breach of contract; 2) fraud; 3) unjust enrichment; 4) conversion of chiropractic property; 5) violations of Pennsylvania’s Wage Payment Law; and 6) piercing of the corporate veil. On May 28, 2002, Appellant filed an amended complaint at law, containing the same six causes of action. On July 3, 2002, Nicosia filed an answer to Appellant’s amended complaint, and also filed a counterclaim, alleging that Appellant owed him money.

On March 3, 2003, Appellant filed an amended complaint in equity and on March 6, 2003, Appellant filed his second amended complaint in equity, which contained the same causes of action. On March 10, 2003, Appellant’s causes of action in equity and at law were consolidated for trial.

On July 1, 2003, Allegheny County Court of Common Pleas Judge Livingstone M. Johnson stated that he would divide the actions into three trial phases: Phase One, Appellant’s declaratory action for a partnership; Phase Two, Appellant’s accounting action; and Phase Three, the causes of action at law and Nicosia’s counterclaim. On September 25, 2003, Appellant filed an amended complaint at law and added a cause of action for

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breach of partnership fiduciary duties. Nicosia answered the complaint and denied the averments.

From September of 2003 through March of 2005, Judge Johnson conducted trial of Phase One and concluded that a partnership existed between the parties, in agreement with Appellant’s position, and entered an order accordingly on September 14, 2005. The parties filed post-trial motions. Nicosia filed an appeal that was quashed as interlocutory by this Court on March 20, 2008. Stewart v. Nicosia, 946 A.2d 1103 (Pa. Super. 2008).

Judge Johnson’s September 14, 2005 order also set forth the matter that would be covered by Phase Two: the accounting. Phase Three was expected to handle the claims at law set forth at docket number GD 01-14628.

In July of 2008, Judge Christine A. Ward was appointed to handle the consolidated matters. An accountant was appointed to perform the accounting of the chiropractic business (Phase Two), pursuant to paragraphs seven, eight, and nine of Judge Johnson’s September 14, 2005 order.

In January of 2016, the consolidated cases were assigned to Judge Judith L. A. Friedman. Because the court-appointed accountant was not able to finalize the accounting, the trial court took over the accounting and conducted a trial of Phase Two without appointing a different master. Trial Court Opinion, 6/9/17, at 3. Judge Friedman conducted a trial on Phase Two in May of 2017, and on June 9, 2017, entered an accounting in favor of Nicosia and against Appellant for $35,640.33. Id. at 15. Judge Friedman believed

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that her factual findings during Phase Two left nothing to be tried in Phase Three, and in her June 9, 2017 memorandum, she indicated that she would enter an order cancelling Phase Three of the trial. Id. at 3. On June 27, 2017, the court entered an order reflecting same. Appellant filed several post-trial motions on July 7, 2017, and on the same date, Nicosia filed various motions, including a motion to dismiss the remaining claims as moot.

On August 7, 2017, Judge Friedman entered a judgment against Appellant in the amount of $119,019.16.1 By order and memorandum entered October 25, 2017, the trial court granted Nicosia’s motion to dismiss Appellant’s causes of action at law (Phase Three) because Appellant failed to present “any valid basis for his contention that the above-listed counts at law are still viable.” Trial Court Opinion, 10/25/17, at 4. The court also struck the judgment for $119,019.16, as being prematurely entered. Id. at 4.

On December 5, 2017, Judge Friedman dismissed the litigants’ post-trial motions and entered judgment against Appellant in the amount of

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1 This judgment included $35,640.33, the amount determined to be owed to Nicosia through the accounting. Trial Court Opinion, 6/9/17, at 15. It also included pretrial and post-trial interest on the $35,640.33, in the amount of $38,758.86. Further included were the fees paid to Mr. Ickert, the court- appointed accountant, by Nicosia in the amount of $44,619.97. Trial Court Opinion, 8/7/17, at 5.

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$119,019.26.2 Trial Court Opinion, 12/5/17, at 1-3. On January 4, 2018, Appellant filed a notice of appeal. On January 26, 2018, Appellant filed his Pa.R.A.P. 1925(b) statement, and on February 20, 2018, Judge Friedman filed her Pa.R.A.P. 1925(a) opinion.3 Appellant presents the following issues for our review:

1. Whether the first trial court, Judge Johnson, correctly concluded the Chiropractic Business at issue was a partnership, and that Dr. Nicosia, as an unlicensed person, could not legally be the 100% owner of the Chiropractic Business as a “division” of his corporation Advanced Diagnostics PC.

2. Whether Dr. Nicosia, as an unlicensed individual, could legally be a 50% partner in the Chiropractic Business with [Appellant] a licensed chiropractor, the other 50% partner.

3. The third trial court, Judge Friedman, incorrectly concluded that if the Chiropractic Business is an illegal partnership, then [Appellant] was in pari delicto with Dr. Nicosia and not entitled to any relief.

4. Whether the accounting determined by the third trial court, Judge Friedman, must be overturned because it did not account for the substantial amount of chiropractic revenue which both litigants claim is still missing.

5. Whether the second trial court, Judge Ward, and the third trial court, Judge Friedman, abused their discretion, and committed an [sic] errors of law, in the manner in which they handled the accounting phase - including subsidy questions per Pa R.A.P. Rule 2111(b).

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2 We note the inconsistency in the identified award amount in the August 7, 2017 order, but do not find this discrepancy to impact the outcome of this matter.

3 Appellant subsequently filed a Combined Motion and Brief on March 8, 2019, and a Motion and Combined Reply Brief on March 27, 2019, with this Court. These motions are denied as moot in light of our holding herein.

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6. Whether the third trial court, Judge Friedman, abused her discretion, and committed an error of law, by her dismissal as “moot” the third phase of Stewart v. Nicosia, which included dismissal of [Appellant’s] seven causes of action at law at GD-01-

014628.

Appellant’s Brief at 5 (emphases in original).

Appellant’s first three issues pertain to the trial court’s findings as related to his partnership with Nicosia. Appellant first asserts that Judge Johnson correctly ruled that the chiropractic business was a partnership. Appellant’s Brief at 22. Appellant furthers this position by stating that:

There [were] more than sufficient facts and circumstances for Judge Johnson to conclude that the Chiropractic Business was a 50%-50% partnership between [Appellant] and [Nicosia], including that the litigants agreed to split 50%-50% the profits and losses from the Chiropractic Business.

Id. Despite these assertions, Appellant then states that “[Nicosia], as an unlicensed person, violated Section 2922(a) of the PA Professional Corporation Law in his attempt to be the sole owner of the Chiropractic Business.” Id. at 24. He further inexplicably mentions Judge Johnson’s observation during the Phase One trial that if Nicosia were the sole owner of the chiropractic business, such action would be unlawful. Id. at 25.

We are unable to discern what, if any, challenge Appellant is attempting to raise in this issue. Judge Johnson indeed agreed with Appellant’s position that there was a fifty-fifty partnership, and entered an order consistent with that determination. Order, 9/14/05, at 1-2. Judge Johnson did not declare it

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to be an illegal partnership. Id. Thus, Appellant is entitled to no relief on this issue.

Appellant next argues that Nicosia, an individual without a chiropractic license, could not legally be a fifty percent partner in the chiropractic business with Appellant, a licensed chiropractor and the other fifty percent partner. Appellant’s Brief at 26. Generally, Appellant asserts that because Nicosia was an unlicensed entity, he could not be a fifty percent partner in a professional partnership, and therefore the partnership was illegal. Id. at 27-28.

We first note that Appellant failed to raise this issue before Judge Johnson during Phase One of the litigation relating to the partnership. Moreover, throughout litigation at the trial phase, it was Appellant’s position that the chiropractic business was a lawful partnership. Complaint, 7/17/01; Complaint, 7/24/01; Amended Complaint, 5/28/02. Accordingly, Appellant cannot now argue that it was not a lawful partnership. Indeed, in Issue one of his appellate brief, as discussed above, Appellant asserts that Judge Johnson correctly determined that the chiropractic business was a lawful partnership owned equally by the parties. “Issues not raised in the lower court are waived and cannot be raised for the first time on appeal.” Pa.R.A.P. 302(a). Thus, this issue is waived and Appellant is entitled to no relief on this claim.

In his third issue, Appellant argues that Judge Friedman incorrectly concluded that if the chiropractic business was an illegal partnership, then

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Appellant was in pari delicto with Nicosia and not entitled to any relief. Appellant’s Brief at 30. Appellant maintains that in this case, Nicosia is the “sole culpable party on the illegal issue.” Id. Appellant further states:

This is because, as Judge Johnson found, [Nicosia] had knowledge prior to the start of the Chiropractic Business it was likely illegal under Pennsylvania law for him to be the 100% owner of the Chiropractic Business.

[Appellant], however, did not have any knowledge of the illegality issue until [Nicosia’s accountant, Mr. Gerson] testified about it during the partnership trial. Further, Mr. Gerson testified he did not share his research on the illegality issue with [Appellant]. As such, [Nicosia] can not obtain court relief while [Appellant] can obtain court relief.

Id. at 30 (emphasis in original, internal citations omitted).

We again note that there was no finding by the trial court that the chiropractic business was an illegal partnership. As Judge Friedman noted in her Pa.R.A.P. 1925(a) opinion:

Judge Johnson, not [Judge Friedman], agreed with [Appellant’s] position that there was indeed a partnership. He declined to declare it an “illegal” partnership but rather concluded that it was a 50-50 partnership which needed to be wound up and entered an order by which the First Phase of the trifurcated trial was concluded. Furthermore, [Appellant] would be in pari delicto with [Nicosia] regarding the existence of an illegal chiropractic partnership and would not be entitled to any relief from the [c]ourt.

Trial Court Opinion, 2/21/18, at 6 (emphasis in original). Judge Friedman simply observed that if there were an illegal partnership, Appellant would be in pari delicto with Nicosia, and therefore not entitled to any relief. She did

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not make that statement as a finding. Thus, Appellant is not entitled to relief on this issue.

In his fourth issue, Appellant argues that the accounting must be overturned because it did not account for the substantial amount of chiropractic revenue which both litigants claim is still missing. Appellant’s Brief at 31. Appellant asserts that during discovery, Nicosia testified that after the chiropractic business ended, Nicosia and his wife:

[r]eviewed the patient files in the Greycat Computer, and compared those entries to the patient paper records, and they compiled a “big long list” of patients who received chiropractic services, were billed for those services, but that the money which was paid for those services was missing.

Id. at 31 (emphases in original). Appellant further contends that there was a dispute as to whom the list of patients and services was given, but asserts that it was never provided to him. Id. Appellant posits that the accounting did not include the amounts of missing money, and as a result, the case must be remanded for a more accurate accounting of chiropractic revenue with a focus on this missing money. Id.

We first note that Appellant has failed to identify where in the record he raised this issue before the trial court, either during the accounting phase of trial or in post-trial motions. “Issues not raised in the lower court are waived and cannot be raised for the first time on appeal.” Pa.R.A.P. 302(a).

Moreover, we shall not assume the burden of searching through the voluminous record in this case in an attempt to determine whether Appellant

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raised this issue before the trial court. “This Court will not act as counsel and will not develop arguments on behalf of an appellant.” Irwin Union Nat. Bank and Trust Co. v. Famous, 4 A.3d 1099, 1103 (Pa. Super. 2010). It is not this Court’s responsibility to comb through the record seeking the factual underpinnings of a claim. Id. When deficiencies in a brief hinder our ability to conduct meaningful appellate review, we may dismiss the appeal entirely or find certain issues to be waived. Id.; Pa.R.A.P. 2101. Because Appellant failed to establish that this issue was raised before the trial court and such failure hinders our ability to conduct meaningful appellate review, we find this claim to be waived. Pa.R.A.P. 2101.

Even if the issue had not been waived, we would conclude that it lacks merit. As referenced in the trial court’s June 9, 2017 decision addressing Phase Two of the litigation related to the accounting, the court was aware of the patient files and billing as included in the Greycat computer system utilized for the partnership. Trial Court Opinion, 6/9/17, at 6-15. Specifically, the trial court stated the following with regard to the Greycat billing information:

We therefore find that [Appellant’s wife] made the complete Greycat billing printouts, probably to be sure [Appellant] had those billing records; we believe it is more likely than not that he had his own patient treatment records for his current patients in his Mt. Troy office and therefore only needed the Greycat printouts to be able to follow up regarding monies that might be due him from the Shadyside practice.

Id. at 11. Therefore, Appellant had the information from the Greycat system that he alleges to have been missing. Moreover, the trial court made the

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following finding: “There was sufficient evidence available for a reasonably accurate accounting of the revenue and expenses and profits and losses of the partnership to be made.” Id. Thus, there is no evidence that a substantial amount of revenue was missing from the records supporting the accounting. As such, we would not conclude that the trial court erred in conducting the accounting.

In his fifth issue, Appellant argues that “the second trial court, Judge Ward, and the third trial court, Judge Friedman, abused their discretion, and committed an errors [sic] of law, in the manner in which they handled the accounting phase–including subsidy questions per Pa R.A.P. Rule 2111(b).”4 Appellant’s Brief at 5. Despite presenting this single issue in his statement of questions involved, Appellant attempts to expand this vague single issue into an additional eight “sub-issues” in the argument section of his brief. Id. at 32-43. The Rules of Appellate Procedure provide that issues to be resolved must be included in the statement of questions involved or “fairly suggested” by it. Pa.R.A.P. 2116(a). “[Pa.R.A.P. 2116(a)] is to be considered in the highest degree mandatory, admitting of no exception; ordinarily, no point will be considered which is not set forth in the statement of questions involved or suggested thereby.” Thomas v. Elash, 781 A.2d 170, 177 (Pa. Super. 2001);

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4 We note that Pa.R.A.P. 2111(b) relates to the contents of an appellate brief and the requirement that an opinion from the trial court be appended to the brief. Accordingly, we are uncertain of the reason or basis for Appellant’s citation to that rule in the context of this issue.

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see also Wirth v. Com., 95 A.3d 822, 858 (Pa. 2014)). These sub-issues are not included in the statement of questions involved, nor are they “fairly suggested” by the extraordinarily vague issue listed in the statement of questions involved. Thus, we hold that Appellant has waived these claims. Graziani v. Randolph, 856 A.2d 1212, 1216 (Pa. Super. 2004).

Moreover, review of these eight sub-issues reveals that at least two of them were not raised in Appellant’s Pa.R.A.P. 1925(b) statement. Specifically, in Appellant’s sub-issue “A,” he asserts that Judge Ward and Judge Friedman erred in failing to apply Clement v. Clement, 260 A.2d 728 (Pa. 1970), to shift the burden in the accounting phase to Nicosia. Appellant’s Brief at 32. This issue was not raised in Appellant’s Pa.R.A.P. 1925(b) Statement. Pa.R.A.P. 1925(b) statement, 1/26/18, at 1-13. Further, Appellant’s sub- issue “B” alleges error by Judge Ward in the appointment of an alleged incompetent witness. Appellant’s Brief at 34. Review of Appellant’s Pa.R.A.P. 1925(b) statement shows no allegation of abuse of discretion or error by Judge Ward. Pa.R.A.P. 1925(b) statement, 1/26/18, at 1-13. Because these issues were not raised in his Pa.R.A.P. 1925(b) statement, they would be waived on this basis as well. See U.S. Bank, N.A. for Certificateholders of LXS 2007-7N Trust Fund v. Hua, 193 A.3d 994, 997 (Pa. Super. 2018) (“Any issues not raised in a Pa.R.A.P. 1925(b) statement will be deemed waived.”) (quoting Commonwealth v. Lord, 719 A.2d 306, 309 (Pa. 1998)).

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Moreover, the trial court conducted a thorough accounting as is reflected in its June 9, 2017 decision. We conclude that the trial court did not abuse its discretion in preparing the accounting, and to the extent that the sub-issues raised in Appellant’s brief under heading “Argument #5” are not waived, we would affirm on the basis of that opinion.5 In his final issue, Appellant argues that Judge Friedman abused her discretion and committed an error of law in dismissing as “moot” the third phase of the trial, which resulted in dismissal of Appellant’s seven causes of action at law. Appellant’s Brief at 43. Appellant maintains that he had viable claims remaining against Nicosia, including claims of unjust enrichment and breach of fiduciary duties. Id. at 43. The trial court addressed this issue in its October 25, 2017 memorandum. Therein, the trial court explained that, given the findings and determinations made during Phase Two of the litigation, there were no viable claims at law remaining against Nicosia. Trial Court Opinion, 10/25/17, at 3-4. Specifically, the trial court explained:

All of the claims at law arise from the relationship between the parties, which [Appellant], in Phase One, had successfully asserted was an “oral at-will partnership.” However, during the Phase Two accounting, the material facts supporting each of these claims at law were decided adversely to [Appellant]. After consideration of the arguments of counsel, we conclude that the claims, as we suspected, are indeed moot. There is no count at law that remains to be tried. Crucial elements, if not all elements of each of the above claims, have already been decided, adversely to [Appellant].

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5 The parties are instructed to attach a copy of the trial court’s June 9, 2017 decision to further pleadings in this matter.

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One important missing element is harm to [Appellant]. The accounting of the partnership revealed that [Appellant] suffered no harm.

Another missing element is wrongdoing by [Nicosia]. The accounting revealed that [Nicosia] had not acted wrongfully at all, and, in fact, that it was [Appellant] who did so, by, inter alia, misappropriating funds that should have gone into the partnership’s “main account,” the Advanced Diagnostics checking account at PNC Bank.

Another significant finding of fact in Phase Two is that the partnership made no profit so there was nothing to be distributed to [Appellant]. There can be no wrongful withholding of distributions if there was nothing to distribute.

Regarding the Wage Payment Law/Act violations, [Appellant] successfully contended that he and [Nicosia] were 50-

50 partners, and presented no evidence during the Phase Two Accounting regarding unpaid salaries, an item that certainly should have been part of the accounting.

Regarding conversion, the evidence and factual findings at Phase Two belie [Appellant’s] assertions that [Nicosia] converted chiropractic equipment to his own use.

The evidence and factual findings at Phase Two also make it clear that [Appellant], not [Nicosia], ended the partnership when he walked out at the end of April 1999.

Trial Court Opinion, 10/25/17, at 3-4 (emphasis in original).

We agree with the trial court’s conclusion regarding Appellant’s final issue and affirm on the basis of its October 25, 2017 memorandum. 6 Accordingly, Appellant is entitled to no relief on this claim.

Judgment affirmed. Application for relief denied.

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6The parties are instructed to attach a copy of the trial court’s October 25, 2017 decision to further pleadings in this matter.

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Judgment Entered.

Joseph D. Seletyn, Esq. Prothonotary

Date: 4/15/2019

Circulated 03/19/2019 04 31 PM No.. GD--Oi,/1.3·�80(Eqliity)

GD·Dl�i4628'(taw.)

IN THE COURT'OF(;QMMON PLEAS OF ALLEGHENY COUNTY.PENNSYLVANIA

DR. ROGER STEWART, ) 'ClVIL DIVISION )

)

)

Plaintiff, ) ·Consolidated Cases known as· ) 01)-0J -13980 (Equity)

) on,o 1-.14628 (Law)

VS, }

):

DR. GREGORYNJCOSIA, ind1viduclH.Y, ) 'and I)R. GREGOR Y-NlCOSIA, partner ) trading as AbVANCEP DIAGNOSTICS, ) and ADVANCEDDIJ'\GNOStIC.$:1 INC., )

)

)

Defendants. )

DECISION

This Decision is entered pursuant to Pa.R.C.P., 103'8'. Seealso Pa;RC.P.. t.2.1.l,.

INTRODUCTION The qor.i�jurt trial of the ·�ccouiitihg phase of the .captioned consoH'd.�J�d· matters, also

referred to as Phasez.wascompleted beforethe.undersigned on May 26, 2017 .. Proposed Finding$ ,of Fact :and briefs in lieu. of oral closlngs Were due on June .6, 2017. Counsel for Plaintiff also made a brieforal argument 1;1qhe end of the trial, Defendants ti'in.e)y filed their proposed findings

and briefs"; Plaintiffs were unable to, do so, As .of June 8, iOl�� 'the· date: :the.. Court p�gart editing: and finalizing its own draft findings (made on May 26. and :27), counsel for P.l�intiffs had. sent an e-mail indicating that he might be able to get his proposed findingsand brief lateron June B at some time onJune 9. We indicatedthat we planned to file this Decisionon June 9,, the. deadline th�t suited the· court's convenience and ourother responsibillties, As a result of the .PJa.lntiff' s delay.in filing, this Decision is in.a clumsier form than l would

have wished. Instead ofreferringto specific proposals by each party, as.Lnad planned, I have listed my initial. findings more or less as first drafted, followed by a list of the numbers of

Defendant' proposedfindings with 'which I concurand which ate. consistent with.my o\VD findings, T have.included at theend of'tlrat list a small number that I would have modified slightly but which are essentially consistent with. my "thoughts. I have ·not confirmed the· 'accuragy of all of Defendants; citations to exhibits and they are to: be used only as 'a suggestion although I .expect that most ate accurate .. Proposed findingsthat werenot accepted' seemed irrelevant or duplicative. Had. Plaintiffs proposed findings been sent in time to be considered, they would have' been listed in the same way, with whatever cave Ms seemed appropriate. This Decision Was in fina) fQIJTI at. 7:QOPM onJune 8', 20.1°1, and.nothing hadbeen receivedby e-mail ototherwisebythen. :PROCEDURAL BACKGROUND The.docket ofthe cases reflects the kmg 'procedtrral history -of the .dispute, The, Ho notable:

Livingstone ·M. Jc,}mson.trifurtrnted the trial. of'the captioned consolidated actions and triedthe.firs; phase over the .course of two years from the Fall 'of 200l until the Fall of 2005. He entered an order; dated September 14, 2005, in. which- he determined· that there· was Indeed a· partnership between the captionedindividuals, two: former. friends, Dr, Roger Stewart, E! chiropractor, and br. Gregoty Nicosia, a psychologist. Thfs order was .docketed on September IB·as were the Findings of Fact and Conclusions ofLaw made by Judge Johnson.

No, 'GD-01-13980.(EcfLilty).

·G.D-01-14628 (Law.)

Judge Johnson also set' forth 'in. paragraphs· 7,. 8,. and· 9· oft.hat order'the scope ofth1s second'

phase; the accounting .of the· partnership. This. phase of the .matter was 'initiaHy assigned to the

Honorable Christine A. Ward, who.: appointed a certified public accountantto dethe accounting on February 4, 2009, after the parties were, unable to. agree :¢11 one. In January 2015, the

undersigned agreedto take.over thesecasestohelp Judge Ward, who handles mostof'the complex litigation- matters for our Court.

The undersigned eventually realized that the court-appointed accountant was not able to finalize the accounting although he clearly .dM a fot of workand organized the Iarge amountof available information 'as best.he could. Because· the partie; hap spent a good deal of money over the. years for the accountant'sfees, we decided to take over the accounting .and. have a trial. of that phase without appointing .a differenrmaster. We; directed the accountant-to provide the· electronic version of.all the work he '.had done to: .counsel for- the: parties so: that each could. give 'that to his own accounting expert The expectation was that each party's own accountant would usethat data (rather than.having to spend time.re-creating it) and supplement it as he or she deemed appropriate and would then testify in the Phase 2 trial as to .the. opinion reached 'regarding who owed whom how much and why ..

Because of.ourconclusion.explalned below, that itis Dr. Stewart who-owesmoney tothe Dr. Nicosia, we have concluded that Phase J is JTIQQt and will consider .entering an order to· that effect at alater date.

J.udge Johnson had made many. findings of fact, some of which are relevant to: the instant accounting; The Court makes the findings: set forth below. The exhibits or testimony supporting

Nb: Gb�_o1�139.�o (Equity)

G_DsOl-14628 (�e;1w}

each finding can be found in the proposed.findings of'the Defendants, or possibly ofthe Plaintiffs, that .are consistent with each finding ofthe Court.

FINDINGS OF FACT l. Dr, Stewartand Dr. 'Nicosia were lifelongfrlends .µnti]:t�e Spring ofl999. 2. At some time prior to August 1995, the parties agreed that Dr; Stewart would expand his existing practice to a. second office.in Dr. Nicosia's space .in the building owned byDr. Nicosia and his wifeon Centre.Avenue in Shadyside. 3, Their' thougb! was that some of Dr, Nicosia 's psychology practice _patients at.thai office who, also needed chiropractic treatment could receive thijt treatment easily if Dr. Siewart shared the .office space. 4. To accomplish that purpose, they entered into a business relationship, which Judge Johnson deemed a partnership, in August 1995.

5., th�: terms of the partnership agreement are 'set forth 'in Judge Johnson's order of September 14, 2005, folly quoted below:

1. The Chiropractic business· which Was operated out of Dr. Nicosia's office building at 4927 Centre Avenue in the Shadyside area of Pittsburgh, which is the subject matter ofthe above lawsuit.wasa partnership .between Plaintiff'Dr. Roger:

Stewart and· Defendant Dr. 'Gregory Nicosia.

2. Pr., Roget Stewart was a fifty percent (50%) partner in the _piirtnership and Dr.

Gregory Nicosia.was a fifty pe_rcent(50%)'partner in th� partnership.

3. The partnership began in August of 1995., and. the partnership was. later dissolved in May of 19.99 under 15 Pa.CS.A,. Section 8351, butthe partnership was never legally terminated under I 5 Pa, CS.A. Section, $J52. ·

4,, All property which was. either originally, or, subsequently, brought into the partnership 'is considered partnership property under .1 s Pa,C.S.A. Section 83 D(a), · .,

I

'5. · Dr. Roger Stewart and Dr .. Gregory Nicosia were co-owners ofthe. property of the partnership as tenants in partnership under 1:5 P1:1.Q.:S.A .. Section :834 2'.

6. All J)artn�rship books and records are available for inspection.and copying by any partner under 1.5 P�.C:S.A. Section 8332. · 7.. Each partner is entitled to be repaid his contributions, whether of capital or property, and each partner shall 'shareequally i11 the profits and.surplus remaining after liabilities· have been. paid Under 15 Pa .. C.S.A. Section. ·833 I ( 1) even ifthe specific. dollar amount !S d.etennined by subsequent court proceedings.

:8. Dr, Stewart .and .Dt .. Nicosia are emitJe.d to· their respective fifty percent (50%} Share. of the residual financial. assets of the partnership as .of the date of its dissolution in May of i 999, including, but not necessarily limited to, any outstanding capital contributions, accounts receivable, profits, losses, and goodwill from the business under 1.5 Pl:l,C.S.A. Sections 8342, 8343, 8360, even if the specific dollaramount is determined by subsequent court proceedings.

9.. Dr. Stewart· and Dr. Nieosia are entitled to their respective ,fifty percent (50%)

share of the residual. non-financial. Assets' ofthe 'partnership .as ofthe date ·ofi ts dissolution in May of 1999,.unded s; Pa.Q.S.A. Sections 8342, 8343, 8360,, even if the, specific hems are determined by subsequent court proceedings.

6:. .br. Nicosia handled the finances of both practices by using the softwareknown 1:1s Quicken which could easi !y generate a varietyof'financialreports for each practice, 7-.. Dr. Nicosia also handled all the bankaccountsrelated to both practices,

6

8. Each 'practice was considered a "division" of Advanced Diagnostics, atrade name used by the.

. I . .

i

tWO doctors, created atthe timethe relationshipbetweenihe two doctors began,

9; i)r. Nicosia owned ano.t�er entity known as AdvancedDiagnostics, foe. whlclJ,WflS not part of

the relationship 'between thi two doctors .and which.has no impact on t_Ms, accounting.

../

.

. .

lO. Dr. Nicosia" gave Dr. S1tewart monthly and yearly financial reports generated by Quicken for

I

the Chiropractic practice art� Advanced Diagnostics.

I . . ..

J 1. Both Dr. Stewart and rr. Nicosia made loans to the Chiropractic practice, part of Advanced

Diagnostics.

!,equests

12- There were no sped fie that ·nr, Stewart.cover any losses ofthe .partnership; although

I

the lo arts made, were pr_ob1:try re fated tothe, factthat the Chiropractic practice Was not:' bringing fa_

enough money to cover payroll and its share of the common expenses.

Common.r�ception

1:3. There was a area.where the paper and electronic records of the. Chiropractic

I

practice were kept andcomputers for both practices were also kept.

- j

i

14. There was. a1s,e; 'a qommon patient.appointment bookused QY the staffof both practices.

ig, records Were entered into. a 15. TM Chiropractic .billi .computer that ran Greycat software; this

computer was generaJlyte erred to during the trial as "Greycat."

.

1I I . . .

L6. Greycat Was used exclusively for the Chiropractic practice.

.. I .

'

1 T. Greycat software .is :� billing. record-keeping system that can 'produce HCFA forms for - . I - . ·-· .. . . . . .

submission: of claims to Medicare, I .

Medi:c.aid, and. insurers; . these forms· .includeda direction that '

I .

· payment be, made to Adva7ced Diagnostics.

I

No, GQ,01�{3980 lf quity.)

GD�o1°.146.28 .( L�W)

J 8. Data was entered.into the Greycat computerby staff shared. by the two practices; the data Ohl y pertained to the Chiropractic practice. 19. Dr. Stewart was not able .to use any of the office computers. 20. After entries were made in Greycat, the paperwork from which the entries, were made was placed in the individual patiertt'.s, brlling.file. 21 .. Each.pcitierit of the Chiropractic practice had paperversions: of.a treatment file, and a separate billing file.

2·2. There was also a common billing file that contained copiesof all. the unpt:J.Jq Chiropractic bills.

'

that .had been sent out; this file provided <1. quick.way to- see which patients or-providers needed to

be reminded that the .bill was outstanding and which bills needed to be sent out for collection. 23 .. It was unclearfron} the evidence. wh�t.h�r the original patient, hilli)1g:files or· copies were sent when a collection agency was -ask�d: to collect past -due accounts receivables of the Chiropractic practice. 24. A large number of the chiropractic patients· were coveted by third-party .payers. 25.. When payme.r.t� were made by 'Med,ica,re,. Medicaid or 'Insurers, they were, accompanied :py a forrn r�ferreg.-to as: ah EOl3, an Explanation of Benefits. 26. When payments were, ma,d.e by lawyers-who-represented. the patients in workers compensation or personal injury cases, they were accompanied by a cover letter, 27. Patients who were, "self-pay" J.1su.:1Uy paidon the date: of service; sometimes by credit card,

8

28. When payment checks came in.fhe standard procedure was to givethem, along with the EOB

(or, presumably; the lawyer's· .lerter) to the staff member who. ·was: charged with depositing the checks into' the Advanced. Diagnostics, checking account at PNC Bank; this account was referred

to during the Phase 2 trial as the. "main" account, 29. Only Dr. Nicosia was an authorized signatory of that 'account although Dr: Stewart on one occasion wa� authorized by Dr. Nicosia to sign a check for. $5,000. in postage thllt. needed to- be seat out before the end ofthe year; there is.no dispute regarding.the propriety cf'fhis c_heck.

30. After deposits were .made, the copies ofthe check.and the }:OB (or covet letter) were putin thepatienttreatmentfile to reflect that payment had been made; they did not goback to thepatient

biiling file. 31. The billings ofthe Psychology 'practice were done separately and were never considered by eitherparty to be part of the partnership.. 32. The monies received by the :�sy�h9l0gy practice were; however, comingled in the "main;' account With those of the Chiropractic practice and a third .entity owned by br. 'Nicosia, called TEST2;

3-3. Dr. Nicosia also. owned a business known as TEST,, sometimes referred to in the testimony during the insianf Phase 2 trial as Test One; this buslness had a separate bank 'account and its

monies were not: comingled in the "main" account and have no impact on this accounting; 34. Even though the funds were comingled; they were separately designated in the Quicken records and also on the handwritten deposit slips .so that each amount could be. linked to the relevant doctor in the Chiropractic practice or to the Psychology practice or to TEST l.

No., GD"Ol-13980 (E.qt,Jity)

G D•Ol';i4621f (.Law):

35; In early 1999,, Dr. Nicosia asked his wife to review the patient b'ilhng · accounts for his. Psychology practice, which were in disarray, to figure out which patient bills were paid orunpaid, )6. .Mrs. Nicosia's background indicates that She was qualified.to perform· such a r�vfew,

37, In.the: course of her.review, she found a· 6'Ifling discrepancyregarding one of the p�ycholo�y· patients who also happened to be a patient of Dr. Stewart's· Chiropractic practice. J8. She then checked the billing.records of the Chiropractic practiceon Greycat to see if payments had mistakenly been credited to the wrong patient account. :39. She discovered 'that chiropractic. billings ofroµghly $20;000 for· that patient showed :a zero balance..although no payments had been. recorded. 40. She called the. lawyer who was representing that patien; and was.informed that .he had sent payment of a compromise amount of'roughly $J 5,000 to DL Stewart's practice. 4l. She broughtthis discrepancy to Dr, Nicosia's attention, indicating her suspicion that Dr... Stewart may have been keeping payments for .himself rath�tthan depositing them into the Main Account.

42. Dr. Nicosia dfd .not believe Dr, Stewart woµl9 have ·done such a thingintentionally and asked his· wife to investigate further. 4J. She confronted Dr. Stewart With her findings. and he denied that he had. taken the $15;000 paymentfot.himself 44; Mrs .. 'Nicosia then looked at other patient files via Oreycat ·to find those, that showed high charges-that. had: been "zeroed .out;"

li' No. GD,dl-i{98(J(Equity}

i

i GD-Ol-14618 (law)

I . . pat'. . .ent. file .as .s.he felt,. and the: .Court . . agrees, that

. . would

. have

45. She did .notI�ok· at

consumedan inordinate ameunt lery of time and extra staff work.

46. She discovered thr.ee,ot four other files with largeamounts-that hadbeen paid toDr.,;$�ewm1

I

and had hotbeendepositedlin the Main Account,

I

47. Dr. Stewart withdrewfrom the-partnership on April 30� 1999.

I .

I

48. Dr, Stewart later retu,ed the.$ I 5,000 related to the first patient discrepancy.

4.9,. r». s)ewart did not

r

testimony does. not reveal '(l'hy-. he did not.

his patient treatment or billing flies with him When .he left and the

·

. .I . . . .

50. Dr, Nicosia Ji.ct not cf"nge.:ihe Jocks· on the Shadyside office until aftersome chiropractic , equipment was found to bel m1ssm�.

51. Some time soon after �r. Stewart left the partnership, the Greycat computer crashed.

I

' . . ! . . . . 52,. Mr�, Niccisia,attemptep ·to-l:iave a computer specialist in :the North Hills: retrieve or restore the

I

I

date on 'the hard drive but he: Was unable to and returned the hard drive to: her. 53. No one deliberately :distroyed the Greycat hard drive or deliberately disposed of the- Greycat computer in order to conceal evidence. �4 ,. No one sought a protective order regarding the preservation .of Dr. Stewart; s or Dr. Nicosia' s

records, whether paper 'Or �lectronic Ina timely manner before .or after the l�)V.S,µit Was filed,

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I

. . r ... .

$5.. The Quicken files reJatned available,

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56., The full banking records were available until a fire in Dr. Nicosia's new office destroyed at least some of them if not .al! well after the lawsuit commenced and. a protective order could have been obtained. 57, There is.no credible evidence to support the allegation thahhe:nmt charged to Dr. Stewarr.fer his portion of the, shared 'premises; $2,000, was excessive, 58. There was sufficient evidence available for a reasonably accurate accounting of the revenue and expenses .and profits and losses of the partnership to be made, although assembling that evidence was costly and time-consuming: 59, Mrs. Nicosia.testified that, prior to Dr, Stewart's departure from the partnership, :Mrs. Stewart had arranged With her to· come into the office to print out. all the Greycat. files, Which .consisted .of a.pile ofpaper more. than a foot J:iigh .

. 60. Mi:s .. Stewarrwas not called on rebuttal to deny that she had done this. 6.l. We therefore find that Mrs. Stewart made the complete Grey cat billing printouts, probably to be sure Dr .. Stewart had those l?ilJing. records; we believe it is more likely than not= that he had his own patient treatment records for his current patients in his Mt. Troy office and therefore only needed the 'Greycat printouts to 'be ablerto followup regarding monies that rr.iight be· due him from the Shadyside practice.

62. Plaintiff'� expert accountant, 'Karl A. Jarek, CJ> A.? was 'batted from testifying. because he had not been asked.to render 'an opinion regarding the question to beresolved by the Phase 2 trial, Who

owed how .much to whom and Why; applying paragraphs 7, 8, !'.!PP .9 of Judge Johnson's: order' of September I 4; .2005.

I

No. G Q-01�13980 (Eq9ity)

I GD,Oi�14628 (Law)

I

I

rJpot.t

63; Mr. Jarek's expert was limited· to criticizing the rnethodology used bY the. court-

appointed .

accountant;. because

I

he did not .g. ive any opinion in .his . report on what the final

. . Judge

accounting. under ... . Johnson's order should I . be,·- the· objection '; to his testimony. was sustained

as irrelevant. See page 2- of his expert report, .paragraphs :s-l l,j'n Which he. states the assignment

I

he. was given.and the scope of his report.

I .. . ..

64, The expert witness cal1e.d bYH1y Defendant, Brandon Otis, .a. forensic accountant, was able 'to

I

render an opinion in accot�ance with his expert report, whic,:n addressed the question .b�fore the

Court, based on the data collected by the court-appointed accountant and by .other Items in the I . .

pleadings and elsewhere. i

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. . . . -·_ . . I ... . . . 65. Mr. Otis was very cleat' in his explanation of hqw he arrived at 'his opinion.and the Court finds I .

his testimony and: opinion highly credible.

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·66, The partnership betweln Pt Stewart 'and Dr: Nicosia.never .

made a . profit

.

as defined by. Judge

I

Johnson's order of September 14, :2005-,

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67. Dr: Stewart did not re eive any payment related toprofits ofthe partnership.

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68. Dr: Nicosia dfd not re9ei.ve any payments relatedro profits of the partnership.

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69 . The partnership suffer�q a: net loss over its lifetime {August 199"5-May 1.999): of $18,562 .oo.

. I .

70.. Dr,: Stewart owes Drl Nicosia the sum of $35;27.2:.oo, the amount needed to .equalize the partners'. contributions to the business . over

. ..the

. years.

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7 L Dr, Stewart also owes pr; Nicosia one-halfof'(he "interest" he improperly retained of $736.66.

I

72. Thegrand'total.owed byDr.StewarrtoDr. Nicosia is-$3.5,640.33.

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Nb. GD,Q°l,;1398.0 {Equity)

GD.Oh146l8 (t�w)

We accept Defendants'.' Proposed Findings numbers 1-$, W-3:7,. 40-42,AS·, 47=-49, 51�99;, 101, lOJ, l09- H2, 114, 11'8;'1'23', 1261 l,30-l 3 3, L37-139, 174.

We: accept the following proposed 'findings of Defendants as modi fied:

No. 38 - modified .to reflect that Mrs. Stewart printed out copies of ail the p�t!�ntr�cori:is 0n Greycatand removed those copies frorti' the Chiropractic .office,

No; 5.0 -- modified toreflect that Dr. Stewart cHd not- verify Qr count how many patient tfles were in the Centre Avenue office when h� !�ft and terminated the partnership. No. 102 """ modified to reflect that Judge Johnson's cited fi:'ndings from the Phase J trial were also consistent with and confirmed by the evidence presented at the instant Phase 2 trial.

No. 134· - modified to reflecttharDr, Stewartis to.repay Dr. Nicosia onlyone-halfofthe $7)6,66 retained as interest, i.e. $36&:.33,

Nos., l �5 and 136 - modified to reflect that the total payment due from Dr. Stewart to Dr. Nicosia is $35;640.J-3'.

we· should point out that :pm posed findings of the Defendants that were nei thyr accepted nor modified should not 'be regarded .as having, been implicitly rej ected. Rather, they were either duplicative orirrelevant, atworst, DISCUSSION The Plaintiff had the burden of proving, the facts that would lead to an accounting that awards him his 50%. share of the partnership. profits. He fafled 'to· meet tha; burden, . Instead the credible evidence shows that the partnership found 'to have existed between. Plaintiff and Pr. Nicosia never made a profit.

'.

I No -: ·Go-01° i3980 (E"q·uity)

·Gb-01,.14628 (Law),

!'

I

The credible, evidence also shows. there was no.spoliation of evidence by �h� Defendants, filrt�e·nihows

The credib.le evidence that the paper files: ofbr. Stewm-f s chiropracticpractice were

I

the best.evidence of the ampunts paid ordue to tha,tpractice_. Those �aper files had been preserved . . I . .. .

by· De.fondant.� for several .years, Well after Dr: Ste�a� effectively aba�dqn�d them by not

removing them from the Centre Avenue premises within a reasonable time after he, left the . . I .. ..

premises permanently; The total. rtumber of patient files that could. not· be found amongthe many '

/very

boxes .of records was 27, a smal i num ber,

I

We note that the credible evidence shows that.Dr. Stewart caused equipment to be removed . . I . . - . . . . .. . - .

from; the office butdid.nof remove the individual treatment files, the individual billing filesnor, tiil�aid

possibly, the combined billing files· forall. his patients .. l:ie also !lid nottake steps to procure

I

a. protective .order on or aboutthe time he filed the captioned a.ctioris. or at any reasonable time

I

. - . 1. . .· · ..

thereafter, He cannot now !be heard to-complain that Dr. Nicosiatook insufficjentcare to preserve 'those files when he him&e1f took. no steps to do so.

The Quicken files f'ere all available, according to the. credible· testimony; and: they were

the best electronic: eVideJce available to determine all of the income and expenses of the

I

I

Chiropractic practice.

;

Greycat was obviorly incorrect as to.the three·or four large.balances that were improperly

zeroed out. It cannot be deemed

I

at all.reliableas to amounts . ofincome . . . and

.. ··there is no claim .a, t all ..

that it contained.anything iegarding expenses ofthe Chiropractic practice.

no�

Gross in come is the basis for distributions to-thepartners und�tJµdg�:JObn$o.rf s order ..

I

Each wasonlyentiiled to a!S.0%.share of the profits, after deduction· of expenses. Profits werebest

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I

I'

' 14

Nci. Gb 01>13980 (Equity)

0

G DsOl i4628. '(.law)

0

determined from the Quicken records; accepted without question by Dr, Stewart for the. duration of the partnership:

Lastly, contrary to the. suggestions made by· Plaintiffs counsel, Dr, Nicosia had no duty to

charge Dr, Stewart a .lower rent merely because they were friends, He and Mrs. Nicosia h�.Q the, right to the fair market rental for the premises .and there. is. absolutely no, evidence.to suggest' that

the $4,000· per month total rental, half of which was paid. �Y Or. Stewart, was excessively high or set in bad faith" CONCLUSION

The accounting of'the Court shows that.Dr .. Stewartmust reimburse Pr. N icosia $35,272.'00 ascalculated by Mr. 'Otis. He.must also reimburse Dr. Nicosia.one-half'of the wrongfully withheld "interest," $_36$.J3-. The total he mustpayto Dre Nicosia is $35;640.�3.

In accordance with the Rules of' Court ·dtec1 above, there is .no separate verdict 'slip filed.

-r�6�

This Decision constitutes the award of'the.Court.

�-----=----=--h'�·

8 June20l 7

Circulated 04/05/2019 02:57 PM

TN THE'COURT OF COMMON PLEAS OF ALLEGHENY-COUNTY, PF:NNS-YjLVANIA

l)R, ROGER STEWART, )- CIVIL DIVIS'ION )

)

Plaintiff, } Consolidated Cases known asi } oo.er.nseo (Equity)

) .Gl)�Ol-14628 (Law) · :vs. )'

}

DR. GREGORY.NICOSIA, 'individually, ) . . . . . . I and DR.. Gl\}:GO)tY NICOSIA, partner' ) MEMORANDUM IN 'SUPPQRT ttadingas ADVANCED OlAONO$TICS, ) OF ORDER ANO·ORDE;R ().F-COURT

and ADVANCED DIAGNOSTICS·, JNC,, )

)

Defendants, )

.) HONORABLE JUDITH L. .{. FRIEDMAN

CopiesServed By First.Class.Mail Upon:

•, Glenn P·. Cummings, Esquire ·+J!i 3915 ML Troy Read.First Flo.or ': 6.J:

: .• .v. <....;

Pittsburgh, PA 15212

::.:: z: �-

·-' .... J

.

fj ;,:, .:.�

.::, �LJ

-.. :r:

Paul Yagelski, Esquire ·!

. .tr:·: ROTHMAN GORDAN' I - ..-; � �/ Grant Building, 3rd Floor, 3.1© Grant. Street -�· Pittsburgh, PA l 54.19 i .

I

..

GD.• 01°13980 (Equity)

G0-01-14628 (Law).

IN TH¢.COURTOF COMMON PLEAS OF'ALLEGHENY COUNTY; PENNSYLVANIA

'I

DR. ROGER STEWART, .) CIVJL DIVISION

I

)

).

Plaintiff, ) Consolidated Cases known as ) ·GD-Ol-.i.3980· (Equity)

) ·GD 0l-J 4628 (Law)

0

'vs. )

)

DR. OR.EGOR

I

Y'NIOOSIA, .indlvjdua·l.!y, )

and.DR. GREGORY NlCOSIA, partner )

.trading as AD\(ANC:ED DIAGNOSTICS·, )

and.AJPY AN..C)!Dl>lAQ'N()°STICS, INC,, ·)

)

Defendants. )

)

MEMORANDUM" lN SUPPORT Of;··QRDER , Thecaptioned actions were consolidated and werethen set to· be tried in three phases by the H�norable 'Livingstone M. Johnson, 1fow· fully, retired. Judge Johnson tried Phase ·One and .com::11dcd.thai-a partnership dt'd existbetween the parties and entered an order accordingly, on St:pt�.r:n.b�� J. 4, 20(:)5. Th�i .orderalso set forth the matters which would be covered by Phase Two, llie accolintif!�· Phase Three was expected to handle the cl�ims at .law set forth at GD ·o I -

: In January 20 JS·, the consolidatedcases were.assigned to, the :undersi·sned wfio. entered .a Decision.dated June 8, 2'01'7, after Phase Two of the trial. We believed that our factual findings I .

d.1,ir1n� P.)11:!;,t: Two left.nothing !'O bf; tried "in 'Phase· Three and indicated in 'our Decision that we

i

would enter an order. cancelling that part of the trial. On June 27,. 2017, we entered such an 'I

l

., GD-Ol-.13980 {Equity)

GD 01-14628 (Law)

0

order. Plainti ff; the fl filed .several separate Post-Trial Motions on July"7·, �b 17, and on July 27 ,.

'

20-17", "Defendant filed various motions, including a Motion to Dismiss [Both] Parties' Remaining

· Claims as Moot.

B)' ord�r. dated Augµst 1 O� ·201.7, we directed Pfairi.ti"ff to 'file his answer to the Motion to Dismiss :and also-established a briefing schedule. 'The last; supplemental, briefs were filed by the

18,)0{1, l:.ln.d after a review, weconclude thatthe Motion to Dismiss must be.

. parties· on October i . .

granted.

I

. , I .

The claims .atlaw filed by the Plaintiffat ·on O I -14628 •are set .fort.h in ·an Amended

I

Complaint [Dop. n at 1"4{?2�] whi"¢h was filedon May 28 2002, and which was then itself 1,

i

amended on :Se1ptember 25,2003 [Doc.. 52

r

at 14628) .. The claims are as follows:

Count l..Breach of Contract, vs. Dr'. Nicosia arid the partnership.

Count 2, Wage Payment and Collection Lav/violations, vs . the partnership and Dr.

Nicosia.

CountJ, Unjust Enrichment; vs -, r», Nicosia and Advanced- Diagnostics, Inc.

Count 4, Conversionof.Chiropractic Equipment, vs, Dr. Nicosia.and Advanced

I

Diagnostics, In e·,

1

Count S, Fraud, vs ..Dr . Nicosia . -.

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Count 6·, Shareholder/Officer Participation in Fraudulent Activities and Piercing the

Corporate VeH of Advanced Diagnostics, lne., vs; t». Nicosiaand Advanced Diagnostics, Inc .

Count

t

. I ..

Advanced Diagnosttcs, Inc.

Fiduciary Duties (addedon September 25, 2003, Doc . 52), vs. Dr: Nicosia and

I

GD,01�139ijQ CEqu'_ity)

GQ-OlJA6tB .( Law):

Webelieve th�t the-parties atr�e that the corporate defendant, Advanced Diagnostics, Inc. was

not involved i�· the partnership and 'thatthe claims against rt are no longer beingasserted, The "A�:\,'.arw�d

trade.name Diagnostics" was; however, used.bythe partnership, See 'Decision,

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Findings of Fab no. 8 & 9.

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All of the .clairns .atlaw arise from the .r.eJ.atiooship between the parties, which Plaintiff, in

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Phase One, hatj successfully asserted was, ah "oralat-will partnership." However, during the accounting,

Phase Two the material' facts supporting.each of these claims' at law were decided

adverselyto Pl�intiff Afte'r consideration .ofthe arguments. cf.counsel, we conclude. that the

I

I

claims; 'as we, suspected, are indeed' moot. There is no count.at law that rernalns to be tried ..

Crucial. elemen;ts, if hot- all elements of each of the .above claims, have already been decided,

I

"" I • .

adversely to .P,,l�j11tiff.

'One import.a.t:1( missingelement isharm to Dr. Stewart: The.accounting of the

i

partnership re,,. �aled.that Dr. Stewart suffered no harm.

I

Anothen missing element. is wrongdoing by Dr. Nicosia. 'The account in& revealed that

I

Dr. Nicosia hµ� not acted.wrongfully atall.and, in fact, that H. was Or. Stewart who did so, by,

interalia, :misatpropriating funds that should 'have gone.into the partnership}s "main account,"

I .

the Advanced Diagnostics checking account at .PNC Bank .

\ Anoth.�_rjsign'ificant Iindingof fact ·in.Phase: Two is that the partnership made Fi'O profit so-

'

there was nothing to be. distributed to Or. Stewart There can be. no wrongful withholding of . !.

distributions ifthere was 'nothing to· distribute.

'

Regarding. the.. Wage Payment Law/Act violations, Plaintiff successfully contended that

I

.he and .Dr, Nicosia were: 50-'SO partners, and presented no evidence during the Phase Two '

• A

(JD-01-.13980 (Equity)

Gb-bl�l4628 (Law).

Acco�ting:reg�<Jing unpaid salaries, an item.that.certainly should have been part of the I ..

accounting;

Regarding conversion,

.

'the evidence and factual "fin!;iin.gs. ;at. Phase Two belie Plainti (rs

I

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assertions that Dr: Nicosia· converted chiropractic equipment to his. own use.

The evidence and.factual findings at Phase Two also mike it clear that Dr. Stewart, not· 'Dr. Nicosia, ended the partnership when he. walked out. at the..end of April 199'.9.

i

CONCLUSION

Plaintiff has nor presented any valid basis- for.hiscontention.that the· above-listed counts at law' �re still ·v.J.�b!e. The Motion t6 Dismiss m1,1sJ' begranted. See Order filed' herewith,

For housekeepingpurposes, we ,hav.e .also stricken the judgment. entered, prematurely, after denial ef Plaintiffs post-trial motions filed' as ·10 Phase Two, Seeordet filed separately.

-fir;_ �

:::::�,+-·

��

�S-o6tooer 20·17