Holy Cross Hosp. Inc v. Baskot, CASE NO.:10-62133-CIV-HUCK/O'SULLIVAN
| Decision Date | 23 December 2010 |
| Docket Number | CASE NO.:10-62133-CIV-HUCK/O'SULLIVAN |
| Parties | HOLY CROSS HOSPITAL, INC., Plaintiff v. BILJANA BASKOT, and B. BASKOT, M.D., P.A., Defendants. |
| Court | U.S. District Court — Southern District of Florida |
THIS CAUSE is before the Court on Defendants' Motion to Dismiss Plaintiff's Complaint (D.E. # 24) pursuant to Federal Rule of Civil Procedure 12(b)(1) and 28 U.S.C. § 1367(c)(2). For the reasons discussed below, Defendants' Motion is granted in part and denied in part.
This case involves a dispute between Holy Cross Hospital, Inc., in Ft. Lauderdale, Florida, and its former employee Dr. Biljana Baskot. Holy Cross employed Baskot as an internist from November 1, 2000 to October 31, 2010. Through its Complaint, filed November 4, 2010 (D.E. # 1), as well as its Supplement (D.E. # 19), Holy Cross alleges that Baskot has violated the terms of her Employment Agreement by, inter alia, working at Baskot P.A., 1142 East Broward Boulevard, next door to Holy Cross medical offices, beginning on November 1, 2010. The Complaint also alleges that prior to the termination of her employment, Baskot contacted Holy Cross' third-party payors, notified them that payments for her services to Holy Cross patients were to be sent to Baskot P.A. and sought a contract with one such third-party payor. As a result, Holy Cross alleges, Defendants, Baskot and her professional corporation Baskot P.A., misappropriated payments for services rendered to Holy Cross patients and further violated the Employment Agreement. Finally, Holy Cross alleges that the website that Baskot established around February 2010 to promote her practice at 1142 East Broward Boulevard and other of Defendants' advertisements and promotionsare literally false and/or misleading. On the basis of this alleged wrongdoing, Holy Cross asserts counts for I) false advertising and unfair competition under 15 U.S.C. § 1125(a), Section 43(a) of the Lanham Act, II) violation of Florida's Deceptive and Unfair Trade Practices Act, III) breach of contract (against Baskot individually only), IV) tortious interference with contractual and/or business relations, and V) conversion and seeks damages as well as injunctive and declaratory relief. Holy Cross' Complaint indicates that this Court has subject matter jurisdiction over Count I under the Lanham Act and 28 U.S.C. § 1331 and may exercise supplemental jurisdiction over its related state law claims.
The day after filing its Complaint, Holy Cross moved for a preliminary injunction. Its Memorandum in support of this Motion specifies that Holy Cross is not seeking a preliminary injunction as to Count I (violation of the Lanham Act), but, rather, only as to Counts III (breach of contract) and IV (tortious interference). Holy Cross seeks principally to preliminarily enjoin Defendants from providing medical services in the geographical area covered by the Employment Agreement, soliciting Holy Cross patients or certain former patients and interfering with Holy Cross' contractual and/or business relationships.
On November 10, 2010, the Court held a telephonic status conference and discussed with the parties the allegedly offending material on Defendants' website. On November 16, 2010, the parties filed a Joint Status Report indicating that Defendants voluntarily made the following changes, among others, to their website:
• Defendants removed language regarding Baskot's status as a "top specialist of internal medicine in Fort Lauderdale" and her practice "located in South Florida's Broward County" being "well known for highest-quality of service and care."
• Defendants clarified that Baskot has been in private practice from Nov. 1, 2010, to present and was with Holy Cross from 2000 to Oct. 31, 2010.
• Defendants clarified that Baskot has admitting privileges, not affiliations, with certain hospitals and removed the direct link to Holy Cross' website.
As indicated in the Joint Status Report, the sole remaining area of disagreement between the parties regarding Defendants' current website is the continued listing of Defendants practice location at "1142 E. Broward Boulevard." Despite the fact that this is Defendants' present location, Holy Crosscontends the information is confusing and misleading because this address is directly next door to Holy Cross medical offices. The Court notes that despite the website changes, Holy Cross retains a claim for damages based on the now-removed website content. Additionally, Holy Cross alleges that it was damaged as a result of false and misleading statements made on Defendants website from approximately February to October 2010, Baskot's statements to the Executives' Association of Florida, and an October 31, 2010 advertisement for Defendants' internal medicine practice in the South Florida Sun Sentinel.
Defendants' Motion to Dismiss Plaintiff's Complaint asserts that Holy Cross' Count I Lanham Act claim should be dismissed for lack of subject matter jurisdiction because Holy Cross has not established constitutional and/or prudential standing to bring this claim. Defendants also argue that the Court should decline to exercise its discretion under 28 U.S.C §1367(c) to assert supplemental jurisdiction over Counts II through V, Holy Cross' state law claims. In response, Holy Cross argues that it has established constitutional and prudential standing to bring its claim under Section 43(a) of the Lanham Act and that the Court has and should exercise supplemental jurisdiction over its remaining state law claims.
Under Federal Rule of Civil Procedure 12(b)(1), a defendant may move to dismiss a claim or claims for lack of subject matter jurisdiction. Standing is jurisdictional in nature; therefore, Defendants proceeded under Rule 12(b)(1) to dismiss Count I for lack of standing. Stalley v. Orlando Regional Healthcare System, Inc., 524 F.3d 1229, 1232 (11th Cir. 2008) . Challenges to subject matter jurisdiction can be either "facial" or "factual." Lawrence v. Dunbar, 919 F.2d 1525, 1528-29 (11th Cir. 1990). Facial attacks are limited to plaintiff's allegations, taken as true for the purposes of the motion, whereas factual attacks encompass matters outside the pleadings and allow a district court to weigh the factual record. Id. at 1529. The parties dispute whether Defendants have waged a factual or facial attack on this Court's jurisdiction. Indeed, Holy Cross' Response Memorandum is premised, almost entirely, on its interpretation of Defendants' Motion as a facialattack. However, the Court does not need to resolve this issue because Defendants' Motion, styled as a motion regarding standing and subject matter jurisdiction, is more appropriately viewed as a challenge to the merits of Holy Cross' claim under Section 43(a) of the Lanham Act.
Defendants' Motion contains more than a few statements regarding the deficiency of Holy Cross' Lanham Act claim on the merits. Defendants argue that Holy Cross has not identified any specific facts in support of its allegation that it incurred damages as a result of the alleged false or misleading statements and has not provided the Court "with any legal authority to support the proposition that Dr. Baskot's current and continued practice at 1142 East Broward Boulevard is actionable under the Lanham Act."1 (D.E. # 24 at 9, 12) (alteration in original). The Court believes that the merits nature of Defendants' argument regarding lack of standing is due to the overlap between the test for prudential standing under Section 43(a) and the injury element of such Section 43(a) claims.
To bring a claim under Section 43(a) of the Lanham Act, a plaintiff must have both constitutional and prudential standing. Phoenix of Broward, Inc. v. McDonald's Corp., 489 F.3d 1156, 1161 (11th Cir. 2007). Article III, or constitutional, standing requires that the plaintiff allege "that (1) he has suffered an actual or threatened injury, (2) the injury is fairly traceable to the challenged conduct of the defendant, and (3) the injury is likely to be redressed by a favorable ruling." Id. After determining constitutional standing, the Eleventh Circuit has held that the district court should "consider and weigh the following factors" to determine whether a party has prudential standing to bring a false advertising claim under Section 43(a):
• The nature of the plaintiff's alleged injury: Is the injury of a type that Congress sought to redress in providing a private remedy for violations of the Lanham Act?
• The directness or indirectness of the asserted injury.
• The proximity or remoteness of the party to the alleged injurious conduct.
• The speculativeness of the damages claim.
• The risk of duplicating damages or complexity in apportioning damages.
Phoenix of Broward, Inc., 489 F.3d at 1163-64 (11th Cir. 2007).2 As for the elements of a claim for false advertising under Section 43(a), they are, as follows: "a plaintiff must establish that (1) the advertisements of the opposing party were false or misleading; (2) the advertisements deceived, or had the capacity to deceive, consumers; (3) the deception had a material effect on purchasing decisions; (4) the misrepresented product or service affects interstate commerce; and (5) the movant has been--or is likely to be--injured as a result of the false advertising." Hickson Corp. v. Northern Crossarm Co., 357 F.3d 1256, 1260 (11th Cir. 2004) (citation omitted). A side-by-side comparison of the Phoenix of Broward factors and the injury element of a false advertising claim suggests that the jurisdictional and merits inquiries under Section 43(a) could overlap, and in this case, indeed they do. Defendants argue that Holy Cross has not pleaded any quantifiable claim for...
To continue reading
Request your trial