Med Vision, Inc. v. Medigain, LLC
Decision Date | 31 March 2017 |
Docket Number | Civil Action No. 3:15-CV-77-L |
Parties | MED VISION, INC., et al., Plaintiffs, v. MEDIGAIN, LLC, et al., Defendants. |
Court | U.S. District Court — Northern District of Texas |
Filed Under Seal
Before the court are Plaintiffs' Opposed Motion to Enforce Mediated Settlement Agreement ("Motion") (Doc. 100), filed December 15, 2015; Plaintiffs' Supplemental Motion to Enforce Mediated Settlement Agreement ("Supplemental Motion") (Doc. 115), filed January 21, 2016; and Plaintiffs' Motion for Leave to File Under Seal Plaintiffs' Reply in Support of Objections to Findings, Conclusions, and Recommendation of the United States Magistrate Judge (Doc. 158), filed September 7, 2016.1 In their Motion and Supplemental Motion (collectively, "Motions"), Plaintiffs request that the court require Defendants Pls.' Mot. 7, Pls.' Supp. Mot. 5.
On July 7, 2016, United States Magistrate Judge Paul D. Stickney entered the Findings, Conclusions and Recommendation of the United States Magistrate Judge ("Report") (Doc. 140),recommending that the court grant in part and deny in part Plaintiffs' Motions. Specifically, the magistrate judge recommended that the court grant Plaintiffs' request to enforce the mediated settlement agreement to the extent set forth in the Report but deny Plaintiffs' request for an award of attorney's fees and sanctions against Defendants.
Plaintiffs MedVision, Inc. ("MedVision"); Medi-Tech Medical Billing Services, Inc. ("Medi-Tech"); Phycom Group, Inc. ("Phycom"); Kenneth S. Alston ("Alston"); and Alexander Wang ("Wang") (collectively, "Plaintiffs") and Defendant Gregory Hackney ("Hackney") filed objections to the Report. Plaintiffs object to the magistrate judge's recommendation regarding attorney's fees. Plaintiffs also seek clarification or object to the extent that the magistrate judge "did not recommend that the District Court also Order the Defendants to execute the Agreed Judgment and the Defendants' Notice of Dismissal of Counterclaims with Prejudice which will be presented to Defendants due to their uncur[]ed default." Pls.' Obj. 4. In addition, Plaintiffs object to the extent that the magistrate judge did not address their request for the court to retain jurisdiction "over this matter to ensure compliance with the [MSA] and for purposes of enforcement of the judgment." Pls.' Obj. 4. Hackney objects to the magistrate judge's recommendation requiring Defendants to execute an agreed judgment and contends that the magistrate judge correctly denied Plaintiffs' request for attorney's fees and sanctions.
Plaintiffs' Motion for Leave to File Under Seal Plaintiffs' Reply in Support of Objections to Findings, Conclusions, and Recommendation of the United States Magistrate Judge (Doc. 158) is granted, and the clerk shall file under seal with a file date of September 7, 2016, the reply brief and the exhibits to the reply brief that are attached to the Motion for Leave. After considering Plaintiffs' Motions to enforce the parties' mediated settlement agreement ("MSA"), Plaintiffs'Complaint, the parties' briefs, the MSA, the documents that Plaintiffs seek to have Defendants execute, Plaintiffs' evidence of Defendants' default, and the Report, and conducting a de novo review of the portions of the Report to which objection was made, the court, for the reasons set forth herein, accepts as herein modified the findings and conclusions of the magistrate judge. Specifically, the court rejects the magistrate judge's findings and conclusions regarding an agreed judgment; accepts the magistrate judge's findings and conclusions that Plaintiffs have not established an uncured default by Defendants; and accepts the magistrate judge's findings and conclusions regarding Plaintiffs' request for attorney's fees and sanctions. The court overrules Plaintiffs' objections, sustains Hackney's objections to the extent that the court concludes that Plaintiffs are not entitled to the relief sought, and denies Plaintiffs' Motions (Docs. 100, 115). Additionally, Plaintiffs' request in their objections to submit evidence in support of their request for attorney's fees is denied.
On January 12, 2015, Plaintiffs brought this action against Butani Capital Investment Fund II, LLC ("BCIF"); Dinesh K. Butani ("Butani") (collectively, "Butani Defendants"); and Hackney. For purposes of this order, the court refers collectively to the foregoing parties as "Defendants." Plaintiffs also sued MediGain, LLC ("MediGain"), which was dismissed from this action on December 21, 2015, pursuant to an agreed motion. In their Second Amended Complaint ("Complaint"), Plaintiffs allege that this litigation pertains to certain Asset Purchase Agreements or "APAs" whereby BCIF, as buyer, and MediGain, as guarantor, agreed to purchase substantially all of the assets of medical billing companies MedVision, MediTech, and Phycom. Plaintiffs allege that Defendants, including Medigain, breached the APAs by failing to make required scheduled paymentsand fraudulently induced Plaintiffs to enter the APAs. Plaintiffs' Complaint includes claims against Defendants for breach of contract (BCIF); common law fraud (BCIF, Hackney, Butani); statutory fraud (BCIF, Hackney, Butani); negligent misrepresentation (BCIF, Hackney, Butani); breach of guaranty (Hackney, Butani); conspiracy (BCIF, Hackney, Butani); and breach of fiduciary duty (BCIF, Hackney, Butani). Plaintiffs also requested relief against BCIF under the equitable theories of money had and received, restitution, and unjust enrichment, and sought to recover economic damages, exemplary damages, an accounting, a constructive trust, disgorgement of monies and profits received by Defendants, attorney's fees, interest, and costs.
On November 4, 2015, Plaintiffs and Defendants participated in mediation and reached what the parties refer to as a "Mediated Settlement Agreement" or "MSA," which is signed by Plaintiffs and Defendants. Pls.' App. 1-4 (Doc. 102). The MSA includes certain standard typed settlement language, as well as handwritten language regarding the specific terms of the parties' agreement. The MSA provides in pertinent part as follows:
Settlement Agreement
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