United States District Court, W.D. Pennsylvania
GIBSON UNITED STATES DISTRICT JUDGE.
before the Court is Plaintiff/Counter-Defendant Johnstown
Heart and Vascular Center, Inc. ("JHVC") and
Counter-Defendant Samir Hadeed, MD's (collectively,
"Plaintiffs") Daubert Motion to Preclude
the Report and Testimony of John W. (Jack) Teitz (ECF No. 119
at 5-19). This Motion has been fully briefed and is ripe for
disposition. (See ECF Nos. 120, 128, 152, 153.)
case arises from disputes over the operation of a vascular
center located in Johnstown, Pennsylvania. In short, Dr.
Hadeed and JHVC entered into a series of contracts with
Defendants/Counter-Plaintiffs AVR Management, LLC ("AVR
Management") and Washington Vascular Institute, LLC
("WVI") (collectively, "Defendants") by
which Plaintiffs would operate the "medical side"
of the vascular center and Defendants would manage the
"business side" of the center. Plaintiffs and
Defendants argue that the other side failed to comply with
the duties imposed by these contracts.
reasons that follow, Plaintiffs' Daubert Motion
to Preclude the Report and Testimony of John W. (Jack) Teitz
(ECF No. 119 at 5-19) is GRANTED.
present case arises from various disputes related to the
operation of Advanced Vascular Resources of Johnstown
("AVR-Johnstown"), a limited liability company
created to operate and manage a vascular center in Johnstown,
Pennsylvania. (ECF No. 78 at 4.)
Vascular Resources, LLC ("AVR, LLC") was formed by
Mubashar Choudry, MD to develop vascular facilities on a
national level. (Id.) Dr. Hadeed and JHVC, the
entity through which Dr. Hadeed's cardiovascular practice
is conducted, reached an agreement with AVR, LLC to open a
vascular lab in Johnstown, which would become AVR-Johnstown.
(Id.) To foster the development and operation of
vascular facilities across the country, Dr. Choudry also
formed AVR Management to oversee the management of AVR,
LLC's vascular labs and WVI to oversee the compensation
for JHVC. (Id.) Numerous contracts were executed to
govern the relationships between the various parties.
(Id. at 4-5.)
opening, AVR-Johnstown was an immediate success.
(Id. at 5.) However, complications soon arose with
cash flow, timely bill paying, insurance credentialing, and
employee salary and benefit payments. (Id. at 5-6.)
encountering these problems, JHVC terminated some of the
parties' agreements. (Id. at 6-7.) Shortly
thereafter, the parties' business relationship ended as a
practical matter. (Id.) Plaintiffs changed the locks
on the vascular-center premises and ran a profitable business
at the same physical location without Defendants'
meaningful involvement. (Id.)
then initiated this lawsuit on January 23, 2015. (ECF No. 1.)
In essence, the Complaint alleges severe mismanagement of
AVR-Johnstown by Defendants. (See Id. ¶¶
44-64.) The Complaint is divided into five counts: (1) breach
of contract based on Defendants' mismanagement of
AVR-Johnstown; (2) an accounting; (3) partition/dissolution
of AVR-Johnstown; (4) breach of contract based on
Defendants' failure to pay Plaintiffs' wages; and (5)
fraudulent misrepresentation. (Id.)
denied all liability and brought five counterclaims against
Plaintiffs: (1) breach of contract based on a sublease
between JHVC and AVR-Johnstown (the "Sublease") and
JHVC's Group Physician Agreement (the "GPA")
with WVI; (2) tortious interference with contractual
relations; (3) conversion; (4) unjust enrichment; and (5)
breach of fiduciary duty. (ECF No. 10 ¶¶ 114-36.)
October 17, 2016, Plaintiffs filed a Motion for Summary
Judgment (ECF No. 40) and Defendants filed a Motion for
Judgment on the Pleadings and Motion for Summary Judgment on
Plaintiff's Complaint (ECF No. 44). After extensive
briefing, the Court issued a Memorandum Opinion and Order on
these Motions. (ECF No. 78.) After deciding the parties'
Motions, the following claims remained: (1) JHVC's
breach-of-contract claim based on AVR Management's
mismanagement of AVR-Johnstown in violation of
AVR-Johnstown's operating agreement (the "Operating
Agreement"), with an accounting as a potential remedy
for this breach; (2) JHVC's breach-of-contract claim
against WVI; (3) AVR-Johnstown, AVR Management, and WVI's
counterclaim against JHVC for breach of contract; and (4)
AVR-Johnstown, AVR Management, and WVI's counterclaim for
unjust enrichment against JHVC and Dr. Hadeed. (See
the Court decided the parties' Motions for Summary
Judgment, AVR-Johnstown filed for bankruptcy. (See
ECF No. 93 at 2-3.)
on January 2, 2018, the Court issued a Memorandum Order
sua sponte noting an apparent lack of complete
diversity between the parties and ordering the parties to
brief whether this Court possessed subject-matter
jurisdiction and whether AVR-Johnstown could be dismissed as
a dispensable party. (ECF No. 88 at 1-2.) The Court noted
that the citizenship of an LLC is determined by the
citizenship of its members and, thus, AVR-Johnstown's
citizenship is determined by the citizenship of its members.
(Id. at 1.) The Court indicated that JHVC is a
member of AVR-Johnstown. (Id. at 2.) Because JHVC is
a citizen of Pennsylvania, AVR- Johnstown would also be a
citizen of Pennsylvania. (Id.) Therefore, based on
the information before the Court, there would not be complete
diversity between Plaintiffs and Defendants. (Id.)
parties concluded that there was not complete diversity
between Plaintiffs and Defendants and that AVR-Johnstown was
an indispensable party. (ECF No. 93 at 2.) Therefore, the
Court issued a Memorandum Order on January 17, 2018,
concluding that the Court could not cure the lack of
diversity by dismissing AVR-Johnstown. (Id.)
However, the Court agreed with Defendants that 28 U.S.C.
§ 1334 provided this Court with a basis for
subject-matter jurisdiction. (Id. at 2-3.) The Court
thus referred the case to the Bankruptcy Court. (Id.
September 24, 2018, the Bankruptcy Court dismissed
AVR-Johnstown's bankruptcy case, finding that the case
was commenced without the requisite corporate authority.
See In re Advanced Vascular Res. of Johnstown, LLC,
590 B.R. 323, 328 (Bankr. W.D. Pa. Sept. 24, 2018). This
Court thus withdrew its referral of the case to the
Bankruptcy Court. (ECF No. 94.) On the same day, the Court
dismissed this case for lack of subject-matter jurisdiction,
as there was no longer any basis for jurisdiction under 28
U.S.C. § 1334 and complete diversity was still lacking
between the parties. (ECF No. 95.)
days after the dismissal, Defendants filed a Motion for
Reconsideration and corresponding Brief in Support (ECF Nos.
96, 97). In their Brief, Defendants argued that AVR-Johnstown
was a dispensable party that should be dismissed in order to
restore complete diversity. (ECF No. 97 at 3.) Plaintiffs
disagreed and claimed that AVR-Johnstown was an indispensable
party. (ECF No. 99.)
November 13, 2018, this Court dismissed AVR-Johnstown from
this lawsuit to restore subject-matter jurisdiction.
(See ECF No. 100.)
filed the present Motion on February 8, 2019. The Court held
a Daubert hearing on June 10, 2019. Trial is
scheduled to begin on September 3, 2019.