United States of America v. St. Mark's Hospital

District Court, D. Utah·Decided September 25, 2019·No. 2:16-cv-00304·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH

UNITED STATES OF AMERICA, ex rel. GERALD POLUKOFF, M.D., MEMORANDUM DECISION AND Plaintiff/Relator, ORDER GRANTING DR. POLUKOFF’S MOTION TO DISMISS DR. SORENSEN’S v. COUNTERCLAIM

ST. MARK’S HOSPITAL; INTERMOUNTAIN HEALTHCARE, INC.; INTERMOUNTAIN MEDICAL CENTER; SHERMAN SORENSEN, M.D.; Case No. 2:16-CV-304 TS and SORENSEN CARDIOVASCULAR GROUP, District Judge Ted Stewart

Defendants.

This matter is before the Court on Counterclaim Defendant Dr. Polukoff’s Amended Motion to Dismiss (“Motion”) Dr. Sorensen’s Counterclaim. For the reasons discussed below, the Court will grant the Motion. I. BACKGROUND Counterclaimant Sherman G. Sorensen, M.D. (“Dr. Sorensen”) is a retired cardiologist recognized in Utah for performing septal defect (“ASD”) and patent foramen ovale (“PFO”) closures.1 Counterclaim Defendant Gerald Polukoff, M.D. (“Dr. Polukoff”) is a cardiologist who worked in Dr. Sorensen’s employ from about August to November 2011.2 On December 3, 2015, Dr. Polukoff filed this qui tam action as Relator (“Polukoff”), alleging that Dr. Sorensen performed medically unnecessary ASD and PFO closures, fraudulently collecting payment from

1 Docket No. 248 ¶¶ 7-8. 2 Docket No. 289 ¶ 11. the United States Government in violation of the False Claims Act, 31 U.S.C. §§ 3729–32.3 On January 19, 2018, Dr. Sorensen filed a complaint (“Sorensen”) against Dr. Polukoff and his attorneys making allegations based on facts related to Dr. Polukoff’s former employment with Dr. Sorensen and his alleged unauthorized access to and theft of a hard drive containing patient information.4 Dr. Sorensen now files the Counterclaim before the Court, alleging that Dr.

Polukoff misappropriated trade secrets5 and breached contracts in violation of Utah law.6 Dr. Polukoff seeks dismissal of all claims arguing that (1) they are barred by the relevant statutes of limitations, (2) they fail to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6), (3) Counterclaimant is judicially estopped from bringing such claims, and (4) the Counterclaim is barred by claim preclusion. II. MOTION TO DISMISS STANDARD In considering a motion to dismiss for failure to state a claim upon which relief can be granted under Rule 12(b)(6), all well-pleaded factual allegations, as distinguished from conclusory allegations, are accepted as true and viewed in the light most favorable to Counterclaimant as the nonmoving party.7 Counterclaimant must provide “enough facts to state

a claim to relief that is plausible on its face,”8 which requires “more than an unadorned, the- [Counterclaim-Defendant]-unlawfully-harmed-me accusation.”9 “A pleading that offers ‘labels

3 See Docket No. 90. 4 See Complaint, Sorensen v. Polukoff et al., Case No. 2:18-CV-00067 (D. Utah Jan. 19, 2018), ECF No. 2. 5 See Utah Code Ann. §§ 13-24-1 to -9. 6 Docket No. 248 ¶¶ 61-78. 7 GFF Corp. v. Associated Wholesale Grocers, Inc., 130 F.3d 1381, 1384 (10th Cir. 1997). 8 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). 9 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). and conclusions’ or ‘a formulaic recitation of the elements of a cause of action will not do.’ Nor does a complaint suffice if it tenders ‘naked assertion[s]’ devoid of ‘further factual enhancement.’”10 “The court’s function on a Rule 12(b)(6) motion is not to weigh potential evidence that

the parties might present at trial, but to assess whether the plaintiff’s [or counterclaimant’s] complaint alone is legally sufficient to state a claim for which relief may be granted.”11 As the Court in Iqbal stated, [o]nly a complaint that states a plausible claim for relief survives a motion to dismiss. Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense. But where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not shown—that the pleader is entitled to relief.12 In considering a motion to dismiss, a district court not only considers the complaint, “but also the attached exhibits,”13 the “documents incorporated into the complaint by reference, and matters of which a court may take judicial notice.”14 The court “may consider documents referred to in the complaint if the documents are central to the plaintiff’s [or counterclaimant’s] claim and the parties do not dispute the documents’ authenticity.”15

10 Id. (quoting Twombly, 550 U.S. at 557) (alteration in original). 11 Miller v. Glanz, 948 F.2d 1562, 1565 (10th Cir. 1991). 12 Iqbal, 556 U.S. at 679 (internal citations and quotation marks omitted). 13 Commonwealth Prop. Advocates, LLC v. Mortg. Elec. Registration Sys., Inc., 680 F.3d 1194, 1201 (10th Cir. 2011). 14 Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322 (2007). 15 Jacobsen v. Deseret Book Co., 287 F.3d 936, 941 (10th Cir. 2002). III. DISCUSSION a. Claim Preclusion and Claim-Splitting Counterclaim Defendant argues that claim preclusion bars Dr. Sorensen from bringing the Counterclaim, as he has already brought similar claims in Sorensen. This is incorrect

because claim preclusion requires there to be a final judgment on the merits in the first case, which does not exist in Sorensen. Under Utah law, for an order or judgment to be final, it must dispose of the case as to all the parties, and finally dispose of the subject-matter of the litigation on the merits of the case. In other words, a judgment is final when it ends the controversy between the parties litigant.16

The court in Sorensen did not resolve the state-law claims asserted by Dr. Sorensen and dismissed them without prejudice. Therefore, the judgment cannot be termed “final” as to those claims.17 However, a doctrine related to claim preclusion—that of claim-splitting—does bar the Counterclaim. This doctrine gives district courts “discretion to control their dockets by dismissing duplicative cases.”18 More specifically, The rule against claim-splitting requires a plaintiff to assert all of its causes of action arising from a common set of facts in one lawsuit. By spreading claims around in multiple lawsuits in other courts or before other judges, parties waste

16 Gonzales v. Artspace Affordable Hous., LP, 534 F. App’x. 740, 742 (10th Cir. 2013) (quoting Bradbury v. Valencia, 5 P.3d 649, 651 (Utah 2000) (internal quotation marks omitted)). 17 See Cooter &. Gell v. Hartmarx Corp., 496 U.S. 384, 396 (1990) (“‘[D]ismissal . . . without prejudice’ is a dismissal that does not ‘operat[e] as an adjudication upon the merits,” Rule 41(a)(1), and thus does not have a res judicata effect.”); Gold v. Local 7 United Food & Commercial Workers Union, 159 F.3d 1307, 1311 n.5 (10th Cir.

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United States of America v. St. Mark's Hospital, (D. Utah 2019).

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