Advanced Physical Therapy, LLC v. Apex Physical Therapy, LLC

• Decision Date: 16 November 2021
• Docket Number: 6:20-cv-03043-RK
• Parties: ADVANCED PHYSICAL THERAPY, LLC, ZACHARY BALL, TODD LINEBARGER, Plaintiffs, v. APEX PHYSICAL THERAPY, LLC, Defendant.
• Court: U.S. District Court — Western District of Missouri

ADVANCED PHYSICAL THERAPY, LLC, ZACHARY BALL, TODD LINEBARGER, Plaintiffs,
v.
APEX PHYSICAL THERAPY, LLC, Defendant.

No. 6:20-cv-03043-RK

United States District Court, W.D. Missouri, Southern Division

November 16, 2021

ORDER

ROSEANN A. KETCHMARK, JUDGE UNITED STATES DISTRICT COURT

Before the Court are Defendant Apex Physical Therapy's motions for summary judgment on Counts I, II, and III of Plaintiffs Advanced Physical Therapy, Zachary Ball, and Todd Linebarger's First Amended Complaint. (Docs. 120, 122, 124.) The motions are fully briefed. (Docs. 121, 123, 125, 126, 143, 144, 145, 148, 159, 160, 161.) Also before the Court is Defendant's motion to exclude expert testimony of Brittany Hopp (Doc. 128), which is fully briefed. (Docs. 129, 136, 153.) After careful consideration and for the reasons explained below, it is ORDERED that: (1) Defendant's motions for summary judgment on Counts I and II (Docs. 120, 122) are GRANTED; (2) Defendant's motion to exclude expert testimony of Brittany Hopp (Doc. 128) is DENIED; and (3) Defendant's motion for summary judgment on Count III (Doc. 124) is DENIED.

Background

This is a civil action involving claims of malicious prosecution, abuse of process, and computer tampering in violation of Missouri law. Plaintiffs Advanced Physical Therapy, LLC (“Advanced”), Zachary Ball (“Ball”), and Todd Linebarger (“Linebarger”) bring this action against Defendant Apex Physical Therapy, LLC (“Apex”). Plaintiffs' malicious prosecution and abuse of process claims stem from a 2017 lawsuit Apex filed against Plaintiffs in Illinois state court for breach of contract and tortious interference with business expectancy, among other claims.

1

Apex is an Illinois limited liability company that runs a network of physical therapy rehabilitation locations for various industrial clients or facilities. In December 2016, Apex had two facilities in southwest Missouri, located in Springfield and Monett.^[1]

Advanced, established in July 2016, is a Missouri limited liability company providing physical therapy services in northwest Arkansas. Ball is the Chief Executive Officer and sole owner of Advanced. Linebarger is Advanced's Director of Business Development. Advanced opened its first facility in Rogers, Arkansas. In December 2016 this was Advanced's only facility, although it has since expanded throughout the region including into southern Missouri. Ball and Linebarger both reside in Missouri.

On April 30, 2007, Ball began working at Apex as a licensed physical therapist. Ball worked at Apex's Springfield location and was the regional manager for Apex's southwestern Missouri region (encompassing Apex's Springfield and Monett locations). Linebarger began working part-time at Apex's Springfield location in January 2015 in marketing and as a technician. Prior to joining Apex, Linebarger (who is Ball's brother-in-law) did not have any experience in the physical therapy industry but he did have some prior experience in marketing. (Doc. 148-14 at 4.)

On February 3, 2015, Ball signed an Employment Agreement with Apex. The Employment Agreement included a confidentiality provision stating, he “will not make personal use of, nor disclose to any person or entity, any Confidential Information relating to [Apex].” The agreement defined “Confidential Information” to mean:

Manuals, processes, methods, techniques, templates, documents, electronic files, contracts, Referral Sources (as defined below), projected results, supplier lists (including existing and potential supplier information), pricing, marketing, computer programs, skills, performance specifications, technical and other data, designs, schematics, equipment, set-up, billing, samples, products and services information (including information regarding all existing products and services and any future or planned products or services), financial information and results and other information and know-how relating to or useful in the business or operations of any of the APEX Related Parties.

The agreement also included a “Non-Solicitation of Referral Sources” provision:

For a period of two (2) years after the expiration or termination of Employee's employment with the Employer for any reason, and whether voluntary or

2

involuntary and whether for cause or without cause, Employee will not, directly or indirectly, solicit, and will not directly or indirectly contact any existing Referral Source or identified prospective Referral Source with whom Employee has had direct or indirect contact or about whom Employee has learned confidential information and/or trade secrets by virtue of his/her employment with Employer, other than Referral Sources that Employer has not had contact with within the two (2) years immediately preceding the expiration or termination of my employment with Employer. A “Referral Source” is a person or entity which refers or can refer patients to Employer, such as a physician, a hospital, a physician assistant, a nurse practitioner, a nurse case manager, or a business

Linebarger also signed a confidentiality agreement with the same confidentiality provision as Ball's employment agreement. (Doc. 126-9 at 24.) Both agreements signed by Ball and Linebarger also included a provision regarding any breach of the agreement: “In the event of my actual or threatened breach or default of this Agreement, Employer shall be entitled to an ex parte injunction (without notice to or service of process upon Employees) restraining Employee from any such actual or threatened breach or default.”

Ball left Apex on August 12, 2016, followed by Linebarger five days later on August 17, 2016. Around that time, Linebarger texted an administrative assistant at Apex, saying that they were “coming back to Springfield with a vengeance.”

From 2014 to 2017, one of Apex's most important customers was Prime, Inc. Apex considered Prime, a company in the trucking industry, to be a “referral source” as defined in the Agreements. Ball and Linebarger had been Prime's primary points of contact with Apex. While working at Apex, Linebarger became friends with Apex's contact at Prime, Matt Rachel.

On February 29, 2016, Prime wrote a testimonial regarding the physical therapy services provided by Apex. This testimonial was regarded as important for Apex's entry and expansion as a physical therapy service provider in the trucking industry. Seven months later, in September 2016 - and just one month after Ball and Linebarger had left their employment at Apex - Apex saw a nearly identical testimonial from Prime on Advanced's website. Apex was concerned that whatever interactions or communication Ball and Linebarger had with Prime could adversely impact Apex's relationship with the trucking company. (Doc. 126-14 at 6). And in fact, the contract Apex then had with Prime expired on February 28, 2017, after Prime did not renew the contract. The non-renewal letter from Prime stated that the reason for the expiration of the contract was the company had decided to align its post-offer physical practices with its on-site doctor's office. (Doc. 148-2 at 19.)

3

Apex also had a long-standing relationship (since 2005) with Tyson Foods' Monett, Missouri, facility (“Tyson-Monett”). (Doc. 126-41 at 2.) In 2011, Apex had submitted a proposal to provide its services at Tyson Foods' Noel, Missouri, facility (“Tyson-Noel”).^[2] While he was working at Apex, Ball was the main point of contact for Tyson as he spoke with Tyson supervisors and visited and treated patients at the Tyson-Monett facility.

After Ball and Linebarger left Apex and opened Advanced in Arkansas, Apex learned Ball and Linebarger had been in contact with Tyson facilities in the region. In November 2016, Linebarger contacted the Tyson-Noel facility as well as a Tyson Foods' facility in Berryville, Arkansas (“Tyson-Berryville”) to discuss Advanced providing on-site physical therapy at those locations. Ball followed up a few months later.

Following their departure from Apex, Apex learned Ball and Linebarger had opened Advanced and had begun providing physical therapy services in northwest Arkansas and it believed the contacts Ball and Linebarger had with Tyson and Prime after leaving Apex was to procure business for Advanced. (Doc. 126-14 at 7, 9-10.)

Before taking legal action, Apex contacted the Tyson-Berryville facility itself. Apex had been “looking into” and had “planned” to expand into northwest Arkansas, although at the time it initiated a lawsuit against Plaintiffs, Apex did not have any locations in Arkansas. Apex viewed its expansion within southwest and northwest Arkansas as a means to further serve Tyson's facilities beyond the Tyson-Monett facility. (Doc. 126-40 at 4.) However, Apex was not aware of any specific examples of lost business, or that Apex had been directly damaged or injured by Advanced, Ball, or Linebarger's actions. (Docs. 148-12 at 20; 148-40 at 8.)

On December 16, 2016, Apex filed a five-count complaint in Illinois state court against Ball, Linebarger, and Advanced for breach of contract, tortious interference with business relations, and conspiracy (the “Illinois Lawsuit”). (Doc. 126-1 at 3-13.) Three days later, on December 19, 2016, the Illinois state court issued three summonses to be served on Ball, Linebarger, and Advanced. After a private process server was appointed on December 29, 2016, Plaintiffs were served in Missouri on January 10, 2017. On February 7, 2017, Plaintiffs (as the defendants in the Illinois Lawsuit) removed the case to the United States District Court for the

4

Southern District of Illinois. See Apex Physical Therapy, LLC v. Ball, No. 17-cv-00119-JPG-DGW, 2017 WL 3130241 (S.D. Ill. July 24, 2017).

On April 18, 2017, Ball and Linebarger filed a declaratory judgment and injunctive relief action against Apex in Missouri state circuit court. They asked the Missouri court to declare as...