Landrum v. Otero Cnty. Hosp. Ass'n, Inc. (In re Otero Cnty. Hosp. Ass'n, Inc.)

• Decision Date: 23 May 2016
• Docket Number: Case No. 11–11–13686 JA,Adversary No. 15–1016 J
• Citation: 551 B.R. 463
• Parties: In re: Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering), Debtor. Cady Landrum, Plaintiff, v. Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering), and Surgit Moolamalla, Defendants. Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering), Counterplaintiff, v. Cady Landrum, Counterdefendant.
• Court: U.S. Bankruptcy Court — District of New Mexico

551 B.R. 463

In re: Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering), Debtor.

Cady Landrum, Plaintiff

v.Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering), and Surgit Moolamalla, Defendants.

Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering), Counterplaintiff

v.Cady Landrum, Counterdefendant.

Case No. 11–11–13686 JA

Adversary No. 15–1016 J

United States Bankruptcy Court, D. New Mexico.

Signed May 23, 2016

Miguel O Garcia, John R. Hakanson, P.C., 307 East 11th Street, Alamogordo, NM 88310, Attorney for Plaintiff.

Craig H. Averch, Roberto Kampfner, Andrew Macintosh White & Case, LLP, 555 S. Flower Street, Suite 2700, Los Angeles, CA 90071-2433, Attorney for Defendants.

MEMORANDUM OPINION

ROBERT H. JACOBVITZ, United States Bankruptcy Judge

THIS MATTER is before the Court on cross motions for summary judgment.¹ Plaintiff Cady Landrum (referred to hereinafter as “Plaintiff” or Ms. Landrum) filed a complaint in state court against Dr. Surgit Moolamalla in the Twelfth Judicial District Court, Otero County, State of New Mexico as Case No. D–1215–CV–2014–0605 (the “State Court Action”). In this adversary proceeding, she seeks a declaratory judgment determining, among other things, that the State Court Action is not subject to the automatic stay, does not violate the discharge injunction, and is not enjoined by the injunction imposed by the terms of the plan confirmed in the Chapter 11 bankruptcy case (“Bankruptcy Case”) filed by Defendant Otero County Hospital Association, Inc., (d/b/a Gerald Champion Regional Medical Center, d/b/a Mountain View Catering) (the “Hospital”).²

The issues raised in the cross-motions for summary judgment can be reduced to the following: 1) whether the injunction language contained in Section 14.20 of the Hospital's confirmed Third Amended Chapter 11 Plan of Reorganization dated June 20, 2012 for Otero County Hospital Association, Inc. and the order confirming the plan (together, the “Plan”) bars Ms. Landrum's claims against Dr. Moolamalla; and 2) whether the pre-confirmation notice to Ms. Landrum of the then proposed injunction satisfies due process requirements. The Hospital and Dr. Moolamalla (together “Defendants”) assert that Ms. Landrum's State Court Action claims are enjoined by the Plan.³ Ms. Landrum disagrees and contends that neither the terms of the Plan nor the discharge injunction bars such claims. She asserts further that she is not bound by the Plan because she did not receive notice of the Plan.

For the reasons explained below, the Court concludes that Ms. Landrum's claims fall within the language of the injunction set forth in Section 14.20 of the Plan (the “Plan Injunction”).⁴ The facts not subject to genuine dispute also establish that Ms. Landrum received the notices in question, including notice of the final hearing on confirmation of the Plan and notice of the deadline to file administrative claims. However, fact issues raise additional due process concerns that prevent the Court from granting summary judgment in favor of either party.

SUMMARY JUDGMENT STANDARDS

Summary judgment, governed by Fed.R.Civ.P. 56, will be granted when the movant demonstrates that there is no genuine dispute as to a material fact and that the movant is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(a), made applicable to adversary proceedings by Fed.R.Bankr.P. 7056. “[A] party seeking summary judgment always bears the initial responsibility of informing the ... court of the basis for its motion, and ... [must] demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In considering a motion for summary judgment, the Court must “examine the factual record and reasonable inferences therefrom in the light most favorable to the party opposing summary judgment.” Wolf v. Prudential Ins. Co. of America, 50 F.3d 793, 796 (10th Cir.1995) (quoting Applied Genetics Int'l, Inc. v. First Affiliated Sec., Inc., 912 F.2d 1238, 1241 (10th Cir.1990) ). “When the parties file cross motions for summary judgment, ‘... [the court is] entitled to assume that no evidence needs to be considered other than that filed by the parties, but summary judgment is nevertheless inappropriate if disputes remain as to material facts.’ ” Atlantic Richfield Co. v. Farm Credit Bank of Wichita, 226 F.3d 1138, 1148 (10th Cir.2000) (quoting James Barlow Family Ltd. P'ship v. David M. Munson, Inc., 132 F3d 1316, 1319 (10th Cir.1997) ). The party opposing summary judgment “ ‘may not rest on its pleadings, but must bring forward specific facts showing a genuine issue for trial as to those dispositive matters for which it carries the burden of proof.’ ” Kannady v. City of Kiowa, 590 F.3d 1161, 1169 (10th Cir.2010) (quoting Jenkins v. Wood, 81 F.3d 988, 990 (10th Cir.1996) ). See also, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (stating that the opposing party “must set forth specific facts showing that there is a genuine issue for trial” through affidavits or other supporting evidence) (internal quotation marks omitted).

Ms. Landrum's Request to Strike Defendants' Supporting Declarations⁵

Defendants offered the following declarations in support of their request for summary judgment: 1) Declaration of Kelli Dion in Support of Defendants' Motion for Summary Judgment (“Dion Declaration”); 2) Declaration of Andrew C. MacIntosh in Support of Defendants' Motion for Summary Judgment (“MacIntosh Declaration”); and 3) Declaration of Michael J. Paque in Support of Defendants' Motion for Summary Judgment (“Paque Declaration”). See Exhibits A, B, and C to Defendants' Summary Judgment Motion—Docket No. 16. Rule 56(c)(4), made applicable to adversary proceedings by Fed.R.Bankr.P. 7056, requires a declaration in support of a request for summary judgment “be made on personal knowledge, set out facts that would be admissible in evidence, and show that the ... declarant is competent to testify on the matters stated.” Fed.R.Civ.P. 56(c)(4). Ms. Landrum requests the Court to strike the Dion Declaration and the Paque Declaration on grounds that they are not based on personal knowledge, lack foundation, violate the best evidence rule, and contain hearsay. See Plaintiff's Response—Docket No. 17.

The Dion Declaration

The Dion Declaration recites that Ms. Dion is the Director of Quality at Gerald Champion Regional Medical Center (“GCRMC”), which is owned and operated by the Hospital. The Dion Declaration purports to establish that Dr. Moolamalla was employed by the Hospital at all relevant times and provided medical services at GCRMC, including at its Center for Women's Health; that the Center for Women's Health is located on the GCRMC main campus accessible from GCRMC's main building through a covered hallway; and that Ms. Landrum's claims asserted against Dr. Moolamalla in the State Court Action arose at a time when Dr. Moolamalla was employed by the Hospital.

In their reply brief, instead of explaining why Ms. Dion is competent to make the statements contained in the Dion Declaration, Defendants offered the Declaration of Surgit Moolamalla in Support of Defendants' Motion for Summary Judgment (“Dr. Moolamalla Declaration”). See Docket No. 22—Exhibit A. In the Dr. Moolamalla Declaration, Dr. Moolamalla states, among other things, that he was employed by the Hospital from approximately March 17, 2011 through approximately March 20, 2013; that during that time he performed medical services exclusively in his capacity as an employee and on behalf of the Hospital; that he provided medical treatment to Ms. Landrum in August 2011 at the Center for Women's Health; and that the Center for Women's Health is part of the obstetrics and gynecology department of GCRMC and is located on the GCRMC campus.

Pursuant to Rule 56(e), the Court may give a party who has failed to properly support an assertion of fact an opportunity to do so. Consistent with the summary judgment requirements of Rule 56, the Tenth Circuit has recognized that the Court “clearly has discretion to permit supplemental affidavits it finds useful for summary judgment determination.” Lighton v. Univ. of Utah, 209 F.3d 1213, 1227 (10th Cir.2000). Here, Defendants have offered the Dr. Moolamalla Declaration in response to Ms. Landrum's assertion that Ms. Dion lacked sufficient personal knowledge to make the statements contained in her declaration. “ ‘Where the reply affidavit merely responds to matters placed in issue by the opposition brief and does not spring upon the opposing party new reasons for the entry of summary judgment, reply papers—both briefs and affidavits—may properly address those issues.’ ” Stevens v. Water District One of Johnson Cnty., 561 F.Supp.2d 1224, 1232 (D.Kan.2008) (quoting Beck v. Univ. of Wis. Bd. of Regents, 75 F.3d 1130, 1134 (7th Cir.1996) ). Similarly, where a supplemental affidavit “is simply a beefed-up version of the affidavit previously filed and responds directly to issues raised by plaintiffs regarding the validity of the original ... affidavit” it is appropriate for the Court to consider the affidavit if it is helpful to the Court. Vakas v. Transamerica Occidental Life Ins. Co., 242 F.R.D. 589, 593 (D.Kan.2006).

If the Court had decided to grant summary judgment, it would have given Ms. Landrum the opportunity to file a surreply to dispute Dr. Moolamalla's Declaration. Since summary judgment is being denied, the Court will treat as an established fact, for purposes of Defendants' motion for summary judgment only, that Dr. Moolamalla at all material times was an employee of the Hospital and performed the procedures on Ms. Landrum of which she complains in the course of that employment. Ms. Landrum will be given the opportunity to...