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Long Term Care Corp., LLC v. Ramos

United States District Court, E.D. Pennsylvania

August 2, 2018

LONG TERM CARE CORP., LLC, Plaintiff,
v.
AGUSTIN RAMOS, Defendant AGUSTIN RAMOS, Counter Claimant,
v.
LONG TERM CARE CORP., LLC, Counter Defendant AGUSTIN RAMOS, Third Party Plaintiff,
v.
ONIX GROUP, STEPHEN S. SILVER, RONALD E. SCHAFER, Third Party Defendants.

          MEMORANDUM

          GERALD J. PAPPERT, JUDGE

         In early 2016, Long Term Care Corp., LLC (“LTC”) hired Agustin Ramos to run two companies owned and operated by LTC and The Onix Group. Dissatisfied with Ramos's performance, LTC fired him the following year. LTC subsequently sued Ramos in the Chester County Court of Common Pleas seeking a declaration, among other things, that Ramos was an at-will employee with no right to further compensation of any kind. (Compl., ECF No. 1.) Ramos removed the case to federal court and asserted six counterclaims against LTC for fraudulent inducement, breach of contract, breach of the duty of good faith and fair dealing, violations of the Wage Payment Collection Law, unjust enrichment, and promissory estoppel. (CC, ECF No. 13.) Ramos also filed a third party complaint against Onix Group and two of its managing members, Stephen S. Silver and Ronald E. Schafer, asserting the same causes of action brought in his Counterclaims against LTC. (Third Party Compl., ECF No. 6.)

         LTC, Onix, Silver and Schafer move to dismiss Ramos's claims for fraudulent inducement, breach of duty of good faith and fair dealing, unjust enrichment and promissory estoppel.[1] (LTC Mot., ECF No. 16; Third Party Mot., ECF No. 15.) The Court grants in part and denies in part both motions, with leave to amend some of the claims, for the reasons that follow.

         I

         While Ramos was Chief Operating Officer of NMS Healthcare in December 2015, he entered into negotiations with LTC and Onix Group, through Silver and Schafer, to become the Chief Executive Officer of Cadia Rehabilitation and New Castle Rx, LLC. (CC ¶¶ 19-20; Third Party Compl. ¶¶ 19-20.) LTC and Onix operate and manage Cadia and its five healthcare facilities which provide long-term care services in Delaware and Pennsylvania. Onix also operates and manages New Castle, which supplies long-term care pharmacy services to healthcare facilities operated by Onix. (CC ¶¶ 6-8; Third Party Compl. ¶¶ 6-8.)

         Onix sent Ramos a February 24, 2016 letter (the “Offer Letter”) with attachments including a Schedule of Employment Terms and a separate Confidentiality Agreement addressing confidentiality, non-solicitation and non-competition. (Compl. Ex. A; Third Party Compl. Ex. A.) The Offer Letter states that as CEO, Ramos was to identify and acquire new facilities to expand the healthcare business and report to Onix's management committee. (Id.) The Offer Letter further stated that “[a] minimum three (3) year commitment of employment to the Company is required” and that the signing of, and compliance with, the Confidentiality Agreement was a “condition of employment.” (Id.)

         Pursuant to the Schedule of Employment Terms, Ramos would receive a salary of $125, 000 per year. He was entitled to profit sharing, namely specified percentages of improvement in the company's net operating income depending on his time of service. (Id.) Ramos could also receive “a promote of 10% plus an opportunity to secure an additional 5% and to purchase an additional equity position allowing for a total investment of up to 30% for new projects identified and brought in by you where such acquisitions occur.” (Id.) The Schedule also set forth the following “Employment Condition”: “Although it is expected that you will commit to a term of at least 3 years of employment, employment is provided on an At Will basis.” (Id.)

         Ramos accepted the position and resigned from NMS. In doing so, he forfeited a 25% equity ownership in Wellness LLC, a company presumably associated with NMS. (CC ¶¶ 19-20; Third Party Compl. ¶¶ 19-20.) Ramos began working as CEO of Cadia and New Castle on April 4, 2016. (CC ¶ 27; Third Party Compl. ¶ 27.) In May 2017, Ramos learned that an NMS facility in Hagerstown, Maryland would likely shut down. (CC ¶ 27; Third Party Compl. ¶ 27.) Ramos told Silver and Schafer who then instructed Ramos to attempt to buy the property. (CC ¶¶ 32-47; Third Party Compl. ¶¶ 32-48.) Ramos spoke to representatives from Sabra Health Care, REIT, Inc., which owned the facility, several times throughout May and June, about Cadia's desire to take over the property. (Id.) Silver subsequently set up a meeting with Sabra and excluded Ramos from those and further negotiations. (Id.) Ramos was fired on July 27, 2017, before Onix acquired the NMS facility. (Id.) Ramos contends that his contract to run Cadia and New Castle was for a fixed three year term and that he was fired with twenty months remaining on the deal. He seeks to recover damages for his lost salary, profit sharing, and equity interest in the anticipated NMS acquisition.

         II

         To survive dismissal under Rule 12(b)(6) of the Federal Rules of Civil Procedure, the 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 Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is facially plausible when the facts pled “allow[ ] the court to draw the reasonable inference that [a] defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but it has not ‘show[n]'-‘that the pleader is entitled to relief.'” Id. at 679 (quoting Fed.R.Civ.P. 8(a)(2)).

         When the complaint includes well-pleaded factual allegations, the Court “should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief.” See Connelly v. Lane Const. Corp., 809 F.3d 780, 787 (3d Cir. 2016) (quoting Iqbal, 556 U.S. at 679). However, this “presumption of truth attaches only to those allegations for which there is sufficient factual matter to render them plausible on their face.” Schuchardt v. President of the U.S., 839 F.3d 336, 347 (3d Cir. 2016) (internal quotation and citation omitted). “Conclusory assertions of fact and legal conclusions are not entitled to the same presumption.” Id.

         III

         A

         Ramos claims that he was fraudulently induced to resign from NMS and join Onix under a three year contract, not as an at-will employee. LTC, Onix, Silver and Schafer correctly contend that Ramos's fraudulent inducement claims should be dismissed because they are barred ...


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