GGNSC Altoona Hillview LP v. Martz
| Decision Date | 08 February 2016 |
| Docket Number | CIVIL ACTION NO. 3:15-32 |
| Parties | GGNSC ALTOONA HILLVIEW LP, d/b/a GOLDEN LI VINGCENTER-HILL VIEW; GGNSC ALTOONA HILLVIEW GP LLC; GOLDEN GATE ANCILLARY, LLC; GGNSC CLINICAL SERVICES, LLC; GGNSC EQUITY HOLDINGS, LLC; GOLDEN GATE NATIONAL SENIOR CARE, LLC; GGNSC ADMINISTRATIVE SERVICES, LLC; GGNSC HOLDINGS, LLC, Plaintiffs, v. NANCY D. MARTZ, Executrix of the Estate of HARRY L. OTTO, Defendant. |
| Court | U.S. District Court — Western District of Pennsylvania |
MEMORANDUM OPINION AND ORDER
This case arises from state court litigation in the Court of Common Pleas of Blair County, Pennsylvania, wherein the Defendant in the instant matter (Federal Defendant) sued Plaintiffs in the instant matter (Federal Plaintiffs). Here, the Court addresses whether the underlying state court case should be stayed and the parties compelled to arbitration pursuant to an alternative dispute resolution agreement, which Federal Plaintiffs allege governs the underlying dispute. Presently before this Court is an amended motion to dismiss by Federal Defendant Nancy D. Martz, Executrix of the Estate of Harry L. Otto. (ECF No. 13.) For the reasons thatfollow, the Court will GRANT Federal Defendant's motion to dismiss the Complaint to Compel Arbitration and Stay Proceedings in Court of Common Pleas of Blair County, Pennsylvania.
The Court has jurisdiction over Federal Plaintiffs' claims pursuant to 28 U.S.C. § 1332 (a)(1), as there is complete diversity of citizenship between the parties, and the amount in controversy in the state proceeding exceeds $75,000, exclusive of interest and costs, and pursuant to 9 U.S.C. § 4 of the Federal Arbitration Act. Venue is proper pursuant to 28 U.S.C. § 1391(b).
Federal Plaintiffs initiated the instant action by filing a Complaint to Compel Arbitration and Stay Proceedings in Court of Common Pleas of Blair County, Pennsylvania, on February 4, 2015. (ECF No. 1.) The Court notes that this case appears to be one of a number of similarly situated actions arising in federal courts in Pennsylvania. Federal Plaintiffs allege the following relevant facts in the complaint, which the Court accepts as true for the sole purpose of deciding the pending motion.
Decedent, Harry L. Otto, was a resident at the Golden LivingCenter-Hillview skilled nursing facility in Altoona, Pennsylvania, from June 25, 2012 through August 11, 2012. (Id. ¶¶ 3, 23.) At the time of Decedent's admission to the facility, Federal Defendant, as Decedent's Power of Attorney, executed an Alternative Dispute Resolution Agreement (ADR Agreement), which Federal Plaintiffs claim governs the instant dispute. (Id. ¶ 4; ECF No. 1-4.). The ADR Agreement was not a condition of Decedent's admission to the Golden LivingCenter-Hillview facility. (ECF No. 1 ¶ 25.)
The ADR Agreement defines the term "Facility" to mean "the living center, its employees, agents, officers, directors, affiliates and any parent or subsidiary of Facility and its medical director acting in his or her capacity as medical director." (Id. ¶ 26.) In addition, the ADR Agreement defines "Resident" to refer to "the Resident, all persons whose claim is or may be derived through or on behalf of the Resident, including any next of kin, guardian, executor, administrator, legal representative or heir of the Resident, and any person who has executed this Agreement on the Resident's behalf." (Id. ¶ 27.) The ADR Agreement further identifies disputes covered by the ADR Agreement as follows:
This Agreement applies to any and all disputes arising out of or in any way relating to this Agreement or to the Resident's stay at the Facility or the Admissions Agreement between the Parties that would constitute a legally cognizable cause of action in a court of law sitting in the state where the Facility is located. Covered Disputes include but are not limited to all claims in law or equity arising from one Party's failure to satisfy a financial obligation to the other Party; a violation of a right claimed to exist under federal, state, or local law or contractual agreement between the Parties; tort; breach of contract; consumer protection; fraud; misrepresentation; negligence; gross negligence; malpractice; and any alleged departure from any applicable federal, state, or local medical, health care, consumer, or safety standards.
(Id. ¶ 28.) Federal Plaintiffs allege that Federal Defendant's claims in the underlying state court civil action are covered disputes within the scope of the ADR Agreement, and that all such claims arise from Decedent's residency at the GGNSC Altoona Hillview, LP, d/b/a Golden LivingCenter-Hillview skilled nursing facility. (Id. ¶ 29.)
Despite the existence of the ADR Agreement, Federal Defendant, Nancy D. Martz, as Executrix of the Estate of Harry L. Otto, deceased, commenced a general docket civil action in the Court of Common Pleas of Blair County, Pennsylvania, on June 18, 2014, against Federal Plaintiffs, asserting claims pursuant to, inter alia, Pennsylvania's Survival Statute (42 Pa.C.S.A. §8302) and Wrongful Death Act (42 Pa.C.S.A. § 8301). (Id. ¶¶ 1, 30; ECF No. 1-2.) On January 2, 2015, Federal Defendant filed an amended complaint against Federal Plaintiffs in the Court of Common Pleas. (ECF No. 1 ¶ 2.)
The underlying action alleges that Decedent sustained injuries and damages as a result of the allegedly negligent care provided to Decedent by staff at the Golden LivingCenter-Hillview skilled nursing facility and due to allegedly negligent corporate oversight of the facility by Federal Plaintiffs. (Id. ¶ 16.) Federal Plaintiffs filed Preliminary Objections to Plaintiff's amended complaint on February 16, 2015, arguing, inter alia, that the state court should dismiss Federal Defendant's amended complaint based lack of subject matter jurisdiction because of the existence of the ADR Agreement. (ECF No. 14-2 ¶¶ 10-30.) On April 6, 2015, Federal Defendant filed a response and brief in opposition to Plaintiffs' preliminary objections, arguing that the ADR Agreement failed as a matter of Pennsylvania law. (ECF No. 13 ¶ 8; ECF No. 14-4.) On May 11, 2015, the parties, by and through counsel, appeared before the Honorable Wade A. Kagarise, for oral argument on the state court preliminary objections, including Federal Plaintiffs' preliminary objection to compel arbitration pursuant to the ADR Agreement. (ECF No. 13 ¶ 9.)
By final Opinion and Order, dated May 12, 2015 (the State Court Order), the Court of Common Pleas of Blair County overruled Federal Plaintiffs' preliminary objection to compel arbitration. (ECF No. 14-5.) Applying Pennsylvania law, the State Court Order held that the ADR Agreement could not compel the Wrongful Death claim to arbitration because a wrongful death claim vests in the estate upon the decedent's death and is therefore free from obligations taken on by the decedent. (Id. at 8.) The court reasoned that Federal Defendant signed the ADRAgreement only as Decedent's legal representative, and therefore did not waive her own right to a jury trial. (Id.) The court noted that compelling arbitration would result in a denial of Federal Defendant's rights as a wrongful death claimant who never intended to submit her own claims to arbitration. (Id.) Further, the court concluded that consolidation of the wrongful death and survival claims was appropriate because consolidation was not prohibited or preempted by the FAA, and because consolidation would prevent duplicative and inconsistent liability and damage determinations. (Id.) The court therefore determined that it had jurisdiction to hear the case, given that the ADR Agreement was not binding on Federal Defendant. (Id.) Federal Plaintiffs filed an appeal of the State Court Order on May 29, 2015, which remains pending at this time. (ECF No. 14-6.)
Federal Plaintiffs' complaint asks the Court to compel arbitration of the underlying dispute pursuant to the Federal Arbitration Act (FAA), stay the underlying proceedings in the Court of Common Pleas, and enjoin Federal Defendant from further pursuing the state court action pursuant to the Anti-Injunction Act. (ECF No. 1 ¶¶ 31-37;38-42;43-45.)
Federal Defendant filed a motion to dismiss the Complaint, and a brief in support thereof, on May 11, 2015. (ECF Nos. 7, 8.) Federal Defendant filed an amended motion to dismiss and brief in support thereof on September 8, 2015, after the state court had overruled Federal Plaintiffs' preliminary objections. (ECF Nos. 13, 14.) Federal Plaintiffs filed a response to the original motion to dismiss (ECF No. 9), and a response to the amended motion to dismiss, wherein Federal Plaintiffs responded only to those arguments that were raised for the first time in the amended motion to dismiss. (ECF No. 18.) Federal Defendant filed a reply brief and supplemental brief in further support of the motion to dismiss. (ECF Nos. 23, 24.)
As the parties have fully briefed the Court on the pending motion, the matter is now ripe for adjudication.
Defendant has filed a motion to dismiss Plaintiffs' complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The Federal Rules of Civil Procedure require that a complaint contain "a short and plain statement of the claim showing that the pleader is entitled to relief." FED. R. CIV. P. 8(a)(2). Rule 12(b)(6) allows a party to seek dismissal of a complaint or any portion of a complaint for failure to state a claim upon which relief can be granted. Although the federal pleading standard has been "in the forefront of jurisprudence in recent years," the standard of review for a Rule 12(b)(6) challenge is now well established. Fowler v. UPMC Shadyside, 578 F.3d 203, 209 (3d Cir. 2009).
In determining the sufficiency of a complaint, a district court must conduct a two-part analysis. First, the court must separate the factual matters averred from the legal conclusions asserted. See id. at...
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