JNL Mgmt., LLC v. Hackensack Univ. Med. Ctr.
| Decision Date | 02 May 2019 |
| Docket Number | Civil Action No. 18-5221 (ES) (SCM) |
| Parties | JNL MANAGEMENT, LLC & JONATHAN LASKO, Plaintiffs, v. HACKENSACK UNIVERSITY MEDICAL CENTER, et al., Defendants. |
| Court | United States District Courts. 3th Circuit. United States District Courts. 3th Circuit. District of New Jersey |
Not for Publication
Before the Court is Drinker Biddle & Reath LLP ("DBR") and Antonio M. Pozos's (together "Drinker Defendants") motion for judgement on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). (D.E. No. 23). The Court has jurisdiction pursuant to 28 U.S.C. § 1332.1 The Court has considered the parties' submissions2 and decides the matter without oral argument. See Fed. R. Civ. P. 78(b); L. Civ. R. 78.1(b). For the following reasons the Court GRANTS-IN-PART and DENIES-IN-PART Drinker Defendants' motion.
JNL Management LLC ("JNL") is a Florida limited liability company whose manager is Jonathan Lasko ("Lasko"). (Compl. ¶¶ 2 & 3). Lasko and JNL (together "Plaintiffs") initiatedthis action on April 3, 2018. (See Compl.). In relevant part, the Complaint alleges that in early 2016 JNL was engaged in discussions to purchase property located in Mahwah, New Jersey, for use as a behavioral health, residential substance abuse, detoxification and rehabilitation center (the "Facility"). (Compl. ¶ 11). JNL eventually entered into a contract of sale for the property. (Id.).
Around May 2016, JNL began discussions with Hackensack University Medical Center ("HUMC"), a non-profit, research, and teaching hospital that provides tertiary and healthcare needs, regarding a joint venture for the Facility. (Id. ¶¶ 12 & 14). Over the next few months JNL and HUMC engaged in negotiations about the joint venture. (See id. ¶ 16). During this period HUMC conducted due diligence, which included interviewing and interacting with JNL's staff, reviewing financial models, environmental and site reports, and conducting site visits and inspections. (Id. ¶¶ 15 & 16).
Sometime later, HUMC advised JNL that it was exploring a relationship with Carrier Clinic, Inc. ("Carrier"), a not-for-profit behavioral healthcare system that specializes in psychiatric and addiction treatment, and that any joint venture for the Facility would include Carrier. (See id. ¶¶ 13 & 25). The discussions between JNL and HUMC/Carrier eventually led to the parties executing a Letter of Intent, effective "as of July 1, 2017" (the "LOI"). (Id. ¶ 26). The LOI contemplated an arrangement whereby JNL would create a separate entity to purchase the Mahwah property, which would then lease it to a management entity that HUMC and Carrier would create to run the Facility. (See id. ¶¶ 28 & 29).
In late-January 2018, HUMC and Carrier had discussions with JNL regarding Lasko's "unrelated business dealings" with Philip Esformes ("Esformes"). (Id. ¶ 40). Esformes is "the owner of skilled nursing and assisted facilities who is awaiting trial for alleged Medicare fraud." (See id. ¶ 38 n.3). Based on these discussions, HUMC and Carrier requested that a provision beinserted into the lease for the Facility. (Id. ¶ 40). This provision would permit HUMC and Carrier to acquire ownership of the property in the event that Lasko (or any entity he is affiliated with) was prohibited from participating in federal programs, including Medicare. (Id.). Plaintiffs accepted this request. (Id. ¶ 41).
On February 16, 2018, JNL's counsel was informed by Mark Sparta, Executive Vice President and Chief Operating Officer of HUMC, and Audrey Murphy, Executive Vice President and General Counsel of HUMC, that HUMC and Carrier were not going to proceed with the joint venture. (Id. ¶ 38). Specifically, Sparta and Murphy stated that HUMC and Carrier were informed by Drinker Defendants, who represented Carrier during these negotiations, that:
(See id.). Plaintiff contends that these statements "were false, inaccurate, and/or misleading." (Id. ¶ 43).
In a follow-up call, Sparta and Jim Blazar, Executive Vice President and Chief Strategy Officer of HUMC, confirmed to Lasko that Drinker Defendants had made these statements. (Id. ¶ 39). Sparta told Lasko that he was "disappointed" and that if not for this new information, "HUMC was ready to execute the lease and proceed to immediately consummate the joint venture contemplated by the LOI." (Id.). Sparta also told Lasko that "an attorney from DBR who was formerly with the DOJ"—which the Complaint identifies as Pozos (see id. ¶ 38)—revealed this information during a call with HUMC and Carrier. (Id. ¶ 39). In their answer, the Drinker Defendants acknowledge that Pozos spoke with HUMC and Carrier representatives about Lasko,but deny making the alleged statements. (See Answer ¶ 38).
Thereafter, JNL's counsel inquired of HUMC and Carrier as to whether they intended to proceed with the joint venture. (Id. ¶ 44). On February 26, 2018, HUMC and Carrier responded that they would not be proceeding with the joint venture. (Id. ¶ 45).
On April 3, 2018, Plaintiffs filed this action, asserting three claims against Drinker Defendants: Claim 2 - defamation, Claim 3 - false light, and Claim 4 - tortious interference with prospective business relations.3 On May 8, 2018, Drinker Defendants filed an answer. (D.E. No. 17). Subsequently, the parties briefed the instant motion for judgment on the pleadings.
A party may move for judgment on the pleadings after the pleadings are closed. See Fed. R. Civ. P. 12(c). When adjudicating a motion for judgment on the pleading that seeks dismissal for failure to state a clam, the court applies the same standard as under Rule 12(b)(6). See Fed. R. Civ. P. 12(h)(2); Turbe v. Gov't of Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991).
To state a claim a complaint must set forth a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Neither a claimant's "blanket assertion[s]" of a right to relief nor "threadbare recitals of a cause of action's elements, supported by mereconclusory statements" satisfy Rule 8(a)(2)'s requirements. Twombly, 550 U.S. at 556 n.3.
Rule 8(a)(2)'s pleading standard also requires that a complaint set forth the plaintiff's claims with enough specificity as to "give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Twombly, 550 U.S. at 570. The complaint must contain "sufficient facts to put the proper defendants on notice so they can frame an answer" to the plaintiff's allegations. Dist. Council 47, Am. Fed'n of State, Cty. & Mun. Emps., AFL-CIO by Cronin v. Bradley, 795 F.2d 310, 315 (3d Cir. 1986).
In assessing a Rule 12(b)(6), or as here, a 12(c), motion, "all allegations in the complaint must be accepted as true, and the plaintiff must be given the benefit of every favorable inference drawn therefrom." See Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011). But a reviewing court does not accept as true the complaint's legal conclusions. See Iqbal, 556 U.S. at 678. Therefore, a court must first separate a complaint's facts from its legal conclusions and then assess whether those facts raise a plausible claim for relief. See Fowler v. UPMC Shadyside, 578 F.3d 203, 211-12 (3d Cir. 2009).
Finally, "[i]n deciding a Rule 12(b)(6) motion, a court must consider only the complaint, exhibits attached to the complaint, matters of the public record, as well as undisputedly authentic documents if the complainant's claims are based upon these documents." Mayer v. Belichick, 605 F.3d 223, 230 (3d Cir. 2010).
Before proceeding, the Court finds it necessary to first clarify which documents it can properly consider in deciding the instant motion. Drinker Defendants' Answer attached 26 exhibits, upon which the Answer relies to raise several allegations. (See D.E. No. 17). Thesedocuments include publicly available court documents from the Esformes criminal prosecution (see D.E. Nos. 17-3 - 17-6, 17-12 - 17-14, 17-22 & 17-24 - 17-27), a Department of Justice Press Release (D.E. No. 17-7), JNL's Articles of Organization (D.E. No. 17-20) and 2016 Annual Report (D.E. No. 17-21), multiple newspaper articles (see D.E. Nos. 17-8 - 17-11 & 17-15 - 17-19), and a report prepared on behalf of HUMC by a company named Marathon Strategies (the "Marathon Report") (D.E. No. 17-2). Defendants appear to contend that the Court can rely on all these documents because they are "publicly available information" and because these documents were attached to their Answer. (See Defs. Mov. Br. at 6 n.2). Drinker Defendants are only partially correct.
As explained above, where a Rule 12(c) motion asserts that the complaint fails to state a claim, as the instant motion does, the Court applies the same standard contemplated by a Rule 12(b)(6) motion. "[F]ederal courts have complete discretion to determine whether or not to accept the submission of any material beyond the pleadings that is offered in conjunction with a Rule 12(b)(6) motion . . . ." 5C Charles A. Wright, et al., Federal Practice and Procedure § 1366 (3d ed.) (citing, inter alia, Pryor v...
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