Pac. Kidney & Hypertension, LLC v. Kassakian

• Decision Date: 19 January 2016
• Docket Number: Case No. 3:16-cv-0025-SI
• Citation: 156 F.Supp.3d 1219
• Court: U.S. District Court — District of Oregon
• Parties: Pacific Kidney & Hypertension, LLC, Plaintiff, v. Dr. Claire T. Kassakian, Defendant.

156 F.Supp.3d 1219

Pacific Kidney & Hypertension, LLC, Plaintiff,

v.Dr. Claire T. Kassakian, Defendant.

Case No. 3:16-cv-0025-SI

United States District Court, D. Oregon.

Signed January 19, 2016

James M. Barrett and Leah C. Lively, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., 222 SW Columbia Street, Suite 1500, Portland, OR 97201. Of Attorneys for Plaintiff.

Joel P. Leonard and John D. Ostrander, Elliott, Ostrander & Preston, P.C., Union Bank of California Tower, 707 SW Washington Street, Suite 1500, Portland, OR 97205. Of Attorneys for Defendant.

OPINION AND ORDER

Michael H. Simon

, United States District Judge

Plaintiff Pacific Kidney & Hypertension, LLC (“Plaintiff” or “Pacific Kidney”) seeks a temporary restraining order and preliminary injunction against Defendant Dr. Claire T. Kassakian (“Defendant” or “Dr. Kassakian”). Dkt. 3. On January 19, 2016, the Court held a hearing on Plaintiff's motion for a temporary restraining order. Pacific Kidney appeared through its counsel James M. Barrett of OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C. Dr. Kassakian appeared through her counsel, Joel P. Leonard and John D. Ostrander of ELLIOTT, OSTRANDER & PRESTON, P.C. For the reasons stated below, Plaintiff's motion for a temporary restraining order is granted in part and denied in part.

STANDARDS

In deciding whether to grant a motion for a temporary restraining order (“TRO”), courts look to substantially the same factors that apply to a court's decision on whether to issue a preliminary injunction. See Stuhlbarg Int'l Sales Co. v. John D. Brush & Co., 240 F.3d 832, 839 n. 7 (9th Cir.2001)

. A preliminary injunction is an “extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter v. Natural Res. Def. Council , 555 U.S. 7, 22, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008). A plaintiff seeking a preliminary injunction generally must show that: (1) the plaintiff is likely to succeed on the merits; (2) the plaintiff is likely to suffer irreparable harm in the absence of preliminary relief; (3) the balance of equities tips in favor of the plaintiff; and (4) an injunction is in the public interest. Winter , 555 U.S. at 20, 129 S.Ct. 365 (rejecting the Ninth Circuit's earlier rule that the mere “possibility” of irreparable harm, as opposed to its likelihood, was sufficient, in some circumstances, to justify a preliminary injunction).

The Supreme Court's decision in Winter

, however, did not disturb the Ninth Circuit's alternative “serious questions” test. Alliance for the Wild Rockies v. Cottrell , 632 F.3d 1127, 1131–32 (9th Cir.2011). Under this test, “ ‘serious questions going to the merits' and a hardship balance that tips sharply toward the plaintiff can support issuance of an injunction, assuming the other two elements of the Winter test are also met.” Id. at 1132. Thus, a preliminary injunction may be granted “if there is a likelihood of irreparable injury to plaintiff; there are serious questions going to the merits; the balance of hardships tips sharply in favor of the plaintiff; and the injunction is in the public interest.” M.R. v. Dreyfus , 697 F.3d 706, 725 (9th Cir.2012) (citing Cottrell ).

Finally, a temporary restraining order is necessarily of a shorter and more limited duration than a preliminary injunction.¹ Thus, the application of the relevant factors may differ, depending on whether the court is considering a temporary restraining order or a preliminary injunction.² Indeed, the two factors most likely to be affected by whether the motion at issue is for a TRO or a preliminary injunction are the “balancing of the equities among the parties” and “the public interest.”

FINDINGS OF FACT

Based on the evidence presented by the parties thus far, and subject to revision after the hearing on Plaintiff's motion for preliminary injunction, the Court finds the following facts are more likely true than not:

1. Pacific Kidney is a limited liability company with its principal place of business in Colorado. It provides nephrology services to patients in the Portland, Oregon metropolitan area who need treatment from physicians with expertise in kidney disease

. Pacific Kidney offers its services at several office locations as well as at hospitals and dialysis clinics. Dr. Robert Provenzano, M.D., a resident and citizen of Michigan, is the sole member of Pacific Kidney.

2. Dr. Kassakian is a physician who provides nephrology services to patients with kidney disease

. Beginning September 1, 2014, Dr. Kassakian was employed by Pacific Kidney in Portland, Oregon. Shortly before she began working for Pacific Kidney in Portland, Dr. Kassakian moved to Oregon from Rhode Island. More than six months before she began working for Pacific Kidney, Pacific Kidney informed Dr. Kassakian in a written employment offer that nonsolicitation and noncompetition agreements would be required as a condition of her employment. Dr. Kassakian signed a Physician Employment Agreement (the “Agreement”), containing nonsolicitation and noncompetition agreements, with Pacific Kidney in February 2014.

3. Paragraph 1 of the Physician Covenants, entitled “Non-Solicitation,” as contained in Exhibit B of the Agreement, provides, among other things:

[F]or a period of two (2) years after the termination of Physician's [Dr. Kassakian's] employment for any reason (whether voluntary or involuntary), Physician will not, directly or indirectly, take any action that results or may be expected to result in (i) soliciting, diverting, or interfering with any relationship that [Pacific Kidney] has with any patients or customers of [Pacific Kidney] ....

Paragraph 2 of the Physician Covenants, entitled “Non-Competition,” provides, among other things:

[F]or a period of one (1) year after the termination of Physician's [Dr. Kassakian's] employment for any reason (whether voluntary or involuntary), Physician [Dr. Kassakian] will not, without prior consent of [Pacific Kidney], directly or indirectly ... establish or otherwise assist any entity or individual in the development or management of any program or service related to Nephrology Services within a twenty-five (25) mile radius of any Health Care Facility location where Physician practices during the Initial Term or Renewal Term (collectively, the “Restricted Area ”) that is or will be in competition with any of the health care services provided by or on behalf of [Pacific Kidney] or [Pacific Kidney's] management company within the Restricted Area.

Paragraph 2 further provides:

In the event that Physician [Dr. Kassakian] remains in the Restricted Area but chooses to restrict Physician's medical practice in violation of [her non-competition covenant], then Physician [Dr. Kassakian] agrees to pay [Pacific Kidney] liquidated damages in an amount [equal to the total cash compensation paid to Physician during Physician's last twelve (12) months of employment,] which is reasonably calculated to permit [Pacific Kidney] to recoup its substantial investment, including lost profits, in order to continue to make critical health care services available to the public in the Restricted Area. Physician [Dr. Kassakian] and [Pacific Kidney] agree that this provision is intended to permit [Pacific Kidney] to reasonably protect [Pacific Kidney's] financial investment in promoting the general public's access to health care services, this provision does not unreasonably restrict the general public from accessing Physician's services and the limitations imposed by this provision are both reasonable and sufficiently limited in scope that they will not interfere with the public's interests.

Paragraph 3 of the Physician Covenants, entitled “Liquidated Damages,” provides:

Physician's [Dr. Kassakian's] liquidated damages will equal the total cash compensation paid to Physician during Physician's last twelve (12) months of employment with [Pacific Kidney]: provided that if, upon termination, Physician has been employed by [Pacific Kidney] for less than twelve (12) months, Physician's total cash compensation through the termination date will be annualized, and the liquidated damages amount will be equal to the annualized amount. To the extent that the physician breaches this Agreement and fails to pay the liquidated damages within thirty (30) days of the notice in Section 2, above, then Physician will be liable for the full damages to [Pacific Kidney], including, but not limited to, the liquidated damages.

Paragraph 5 of the Physician Covenants, entitled “Reasonableness,” provides:

The Parties acknowledge and agree that a more precise measurement of damages is not feasible and that they accept the amount as determined by Section 3 above as the damages in fact and a reasonable amount intended to take into account the substantial costs, expenses and resources invested in Physician's [Dr. Kassakian's] medical practice by [Pacific Kidney], in relation to Physician's services to the general public in the Restricted Area. In the event that the amount of liquidated damages under Section 3 above is deemed by a court of competent jurisdiction to be unreasonable, the court will in good faith reform this Section 3 above to provide a liquidated damages amount that is reasonable.

Paragraph 7 of the Physician Covenants, entitled “Equitable Relief,” provides:

Physician [Dr. Kassakian] agrees that any violation by Physician of any covenant in this Exhibit B will or would cause [Pacific Kidney] to suffer irreparable injury, the exact amount of which will be difficult to ascertain. For that reason, Physician agrees that [Pacific Kidney] will be entitled, as a matter of right, to a temporary, preliminary and/or permanent injunction and/or other injunctive relief, ex parte or otherwise, from any court of competent jurisdiction, restraining any further violations by Physician. Such injunctive relief will be in addition to and in no way limit any and all other remedies [Pacific Kidney] will have in law and equity for the

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