Maumelle Medical Clinics Inc v. Wal-Mart Stores Arkansas LLC
MEMORANDUM OPINION AND ORDER. Signed by Honorable Robert T. Dawson on November 30, 2011. (adw)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
MAUMELLE MEDICAL CLINICS, INC.
Civil No. 10-5165
WAL-MART STORES, ARKANSAS, INC.
MEMORANDUM OPINION AND ORDER
Currently before the Court are Defendant’s Motion for Summary
Response and supporting documents (docs. 109-11), Defendant’s Reply
(doc. 113-14), and Plaintiff’s supplemental responses (docs. 11718).
Also before the Court are Defendant’s Motion for Voluntary
Dismissal of Counterclaim (doc. 121), Plaintiff’s Response (docs.
122-23) and Defendant’s Reply (doc. 126). Plaintiff alleges claims
pursuant to 42 U.S.C. §§ 1981 & 1982, the Arkansas Civil Rights
Act, Ark. Code Ann. § 16-123-101 et seq., and Arkansas common law
claims for breach of contract and tortious interference with a
As reflected herein, Defendant’s Motion for Summary Judgment
(doc. 105) is GRANTED, and Plaintiff’s claims are DISMISSED WITH
Counterclaim (doc. 121) is GRANTED, and Defendant’s Counterclaim is
DISMISSED WITHOUT PREJUDICE.
Many of the relevant facts in this case remain undisputed. To
the extent that Plaintiff, in responding to Defendant’s Statement
of Facts, has relied on speculation or denials or allegations
without a proper basis in fact or clear citation to facts already
in the record, the Court will view such facts as essentially
undisputed. See Fed. R. Civ. P. 56(e)(2) (“When a motion for
summary judgment is properly made and supported, an opposing party
may not rely merely on allegations or denials in its own pleading;
rather, its response must. . . set out specific facts showing a
genuine issue for trial.”). To the extent they are relevant, those
facts not specifically controverted by Plaintiff will be deemed to
have been admitted pursuant to Local Rule 56.1.
has provided some basis in fact or in the record, however, the
Court has made all inferences in its favor, as is appropriate when
making a summary judgment determination. Canada v. Union Elec. Co.,
135 F.3d 1211, 1212-13 (8th Cir. 1998) (citing Buller v. Buechler,
706 F.2d 844, 846 (8th Cir. 1983).
The following facts are
undisputed, except where noted:
Jerry Poole d/b/a Maumelle Medical Clinics, Inc. filed this
action on June 30, 2010.
A first amended complaint was filed
on July 16, 2010, substituting Maumelle Medical Clinics, Inc.
(“MMC”) as the plaintiff.
A copy of the “Master Lease
Agreement” (“Lease”) between MMC and Walmart was attached as
Exhibit 1 to both complaints.
In late August or early September 2009, Poole contacted
Walmart employee, Patrick Beasley, Senior Manager Innovations,
Health Business Development, expressing interest in opening a
clinic in a Walmart location.
Administrator on October 6, 2009, to operate a clinic at the
Baseline Road Walmart location (Baseline Walmart) and Dr. John
Agwunobi, Senior Vice President & President Health & Wellness,
signed on behalf of Walmart on October 20, 2009.
The clinic opened on November 2, 2009, operating as a d/b/a of
MMC called “30 Minute Clinic.”
The clinic was located at the
front of the Baseline Walmart adjacent to other tenant spaces
and across from the check out registers.
The permitted use of the leased space was “solely for the
purpose of operating a healthcare clinic, which offers to the
public such limited well patient care, preventative care,
patient education services, and diagnosis and treatment of
minor medical conditions and minor injuries as ordinarily
provided in a primary care clinic by nurse practitioners,
physician assistants, or physicians...” (Doc. 105-4, Lease,
The relationship between Walmart and MMC was a landlord-tenant
The Lease required, in part, that MMC “conduct
its business, at a minimum, in an efficient, first-rate, and
reputable manner”; a prohibition on the use of the premises to
conduct an illegal business; a prohibition against interfering
with Walmart’s business or the business of another tenant; a
requirement to conduct business in a professional manner; a
requirement to comply with all federal and state laws and an
hours of operation requirement.
(Doc. 105-4, Lease, ¶¶
6.2(B), 6.10(F), 6.10(G), 8.1(B), 8.2(A), Appendix-1, ¶3).
On April 10, 2010, Asset Protection Associate Brenda Lee
called the police to the Baseline Walmart because there was a
crowd in front of the 30 Minute Clinic that was blocking
customers exiting the cash register area from the exit of the
Paragraph 6.10(G) of the Lease prohibits the tenant from
unreasonably interfering with Walmart’s or another tenant’s
business and prohibits “impending the free circulation of
(Doc. 105-4, Lease, ¶6.10(G)).
A Walmart manager on duty on April 10, 2010, told Poole that
“we have a bunch of people milling around here at the front of
(Doc. 105-1, Poole dep. p. 84).
Regarding the April 10, 2010 incident, Poole testified that:
[t]he issue was that Dr. Schock on his own had decided to
write those scripts, photocopy them and sign his
name,...to speed up the process...What apparently had
happened is that all those scripts he had written on that
day before were not honored because they - appear to be and it’s okay to copy a script, but it had to have an
They were all trying to bring
those scripts back that the pharmacy would not honor.
(Doc. 105-1, Poole dep. p. 84).
Dr. Schock, the only physician at the 30 Minute Clinic, used
a pre-printed prescription pad for Phenergan with codeine,
which only required that he write the patients’ names in the
blanks because he thought it would be a time saver if he did
not have to write out a prescription each time he prescribed
Phenergan with codeine.
(Doc. 105-7, Schock dep. pp. 45, 51-
precriptions for Phenergan with codeine from Dr. Schock and
some specifically asked for it.
(Doc. 105-7, Schock dep. pp.
Phenergan with codeine is a controlled substance that can be
addictive and abused.
Ryan Adams, one of the Pharmacists at the Baseline Walmart,
testified that Dr. Schock’s prescriptions of Phenergan with
codeine “raised a red flag...writing for the same controlled
substance over and over again, the large quantities that are
prescribed are not usually prescribed.
prescriptions with the drug written on it, all of those are
(Doc. 105-8, Adams dep. pp. 125-28, 134).
Pharmacists have a professional obligation to look out for
drug diversion, which is diversion of prescription medication
for purposes other than the medical condition for which the
participate in drug diversion.
The pharmacists at the Baseline Walmart were aware that
Phenergan with codeine is used to make a street drug called
Sizzurp or Purple Drank.
Some of the pharmacists at the Baseline Walmart advised Randy
concerned about Schock’s prescribing practices for Phenergan
These concerns were passed along to Paula Barton, Senior
Director, Health & Wellness Compliance; Terry Crabb, Senior
Director, Health & Wellness Innovations, all of whom were
located in Walmart’s Home Office in Bentonville.
regarding the concerns.
conversations with Poole regarding the concerns he had about
the 30 Minute Clinic and asked Poole to follow up with him in
writing with a response.
(Doc. 105-5, Shepard dep. pp. 41-
In Plaintiff’s response to Defendant’s Statement of
Undisputed Facts it states the only conversation Poole had
with Shepard was regarding the crowd problem on April 10,
2010, however, Plaintiff provided no citation to the record.
(Doc. 110, p. 16).
Poole responded to Beasley in an email dated April 21, 2010,
which acknowledged the conversation with Shepard regarding the
number of patients on April 10, 2010, and acknowledged Dr.
Schock’s pre-printing of prescriptions. Poole’s email stated,
“[w]hen several pharmacies refused the scripts approximately
(15) patients were returned to the clinic on 4/10/10 to have
their scripts rewritten and that created a crowd control issue
which was resolved promptly.” Poole also acknowledged that he
had discussed reducing the dosage of Phenergan with codeine
with Randy Miller, and that a lower dosage of the drug would
Following Poole’s email, Shepard trusted Poole to resolve the
(Doc. 105-11, 4/21/10 email).
(Ex. 5, Shepard dep. P. 42-43).
On May 11, 2010, at the request of Chris Heinen, Market Area
Asset Protection Manager, Pharmacists Darlene Bell and Adams
gave written statements regarding their continued concerns
about the operation of the 30 Minute Clinic.
statements were provided to Bruce Shepard by Terry Crabb.
(Doc. 105-14, 5/12/10 email).
On May 14, 2010, Shepard initiated a meeting with key Health
Pharmacists’ reports that they continued to have concerns with
the prescriptions being written and the activities involving
(Doc. 105-5, Shepard dep. pp. 50-54).
In the spring of 2010, Brandon Stanford, Asset Protection
Coordinator, asked Brenda Lee, Asset Protection Associate, to
begin surveillance of the activities which were occurring
around the clinic, via the store’s video monitors.
Pharmacist Bell informed Stanford that she felt something
wasn’t right with the prescriptions being written by the
clinic physician, because the Pharmacy was getting requests to
fill a large quantity of Phenergan with codeine.
16, Stanford dep. pp. 32-34).
According to Defendant, Lee observed a number of activities
surrounding the 30 Minute Clinic which she believed to be
suspicious and which she presented to Stanford to review.
Defendant contends there were two males who were observed to
be in and around the 30 Minute Clinic space on a frequent
basis and that Lee observed that these individuals were
escorting people to the clinic, getting them clipboards and
pens to complete paperwork and making contact with the clinic
Defendant asserts that one of the individuals
appeared to be controlling the flow of patients and was
frequently the first and last person in the clinic and in
(Doc. 105-16, Stanford dep. pp. 22-37, 55-56; Doc.
statement). Plaintiff denies these allegations without citing
to the record.
On May 19, 2010, Defendant contends Lee observed suspicious
activity on store video, specifically, money changing hands
between one of the males she had frequently observed to be in
and around the 30 Minute Clinic and a female patient after she
exited the patient area. According to Defendant, Lee observed
the female fill a prescription at the Pharmacy and another
male meeting her by the store entrance to which she handed the
prescription, the male checking the contents and then left the
concurred with Lee’s observation, and provided the information
to his manager, Chris Heinen. (Doc. 105-17, Stanford dep. pp.
25, 59-60; Doc. 105-18).
The individuals observed on the
video were all African American.
Stanford emailed Heinen a timeline regarding the May 19, 2010
incident and four still shots taken from the store video.
Heinen then communicated with Crabb at the Walmart Home Office
and forwarded Stanford’s email to him. Crabb then forwarded
the email to Shepard.
(Doc. 105-18, email string re Clinic
Shepard met with Walmart Health & Wellness
Compliance personnel and Health & Wellness Legal counsel on
May 27, 2010 to discuss the information. (Doc. 105-5, Shepard
dep. pp. 58-61).
According to Walmart, Dr. John Agwunobi, Senior Vice President
& President Health & Wellness, made the decision to terminate
the Lease on Friday, May 28, 2010, based on information
provided by Shepard and Barton and his conclusion that the
number of prescriptions for controlled substance by the Clinic
was unlike any pattern Walmart had ever seen.
Agwunobi dep. pp. 37-45; Doc. 105-5, Shepard dep. pp. 64-65;
Doc. 105-20, 5/28/10 termination letter).
Shepard spoke to Poole by telephone early on Saturday morning,
May 29, 2010, and informed him that Walmart had terminated the
Poole received the letter from Dr. Agwunobi via FedEx
on Tuesday, June 1, 2010.
MMC does not deny this, but
contends it did not receive adequate notice.
On June 4, 2010, Poole spoke to Beasley about his desire to
keep the 30 Minute Clinic open and sent Beasley a follow-up
email on June 6, 2010.
In the email, Poole acknowledged that
“Dr. Schock varied from our protocol on refills of Phenergan
with codeine one time”; that he had “a serious discussion”
with Dr. Schock; and that the 30 Minute Clinic should make
changes and cure any defaults.
Poole, the owner and Clinic Administrator, and Dr. Schock are
Dr. Agwunobi is African American.
neighborhood, which has a predominately African American and
The operation of the 30 Minute Clinic
did not change the demographics of the store’s customers.
The demographic information Walmart provided to Poole during
the discussions regarding MMC opening a clinic showed that the
U.S. Census described the demographic within the zip code for
the Baseline Walmart as “Urban African American.”
Paragraph 6.2(B) of the Lease provides that the tenant “shall
conduct its business, at a minimum, in an efficient, firstrate and reputable manner.”
Section D of paragraph 6.2
provides that a failure to comply with the provisions of 6.2
“materially breaches” the Lease.
Paragraph 8.2 of the Lease
is titled “Compliance” and requires compliance with all state
and federal laws.
Paragraph H of that section provides that
any failure of the tenant to comply with its obligations under
this Section 8.2 is a material breach.
Paragraph 17.1 is
Paragraph E of that section provides that
“breach of any material obligation” of the Lease constitutes
a default of the Lease.
Dr. Schock was the only licensed medical person working at the
clinic. Schock denied that he was the medical director of the
30 Minute Clinic.
Dr. Schock disclaimed any responsibility
for patient records, supervision of the personnel working in
the clinic or what occurred in the clinic waiting room.
Dr. Schock could not recall the names of any of the personnel
who worked in the clinic.
Dr. Schock testified that he was 74
years old and had “some trouble with recent memory.”
questioned about the differences in his recollection and Dr.
Schock’s, Poole stated that Dr. Schock was confused.
After the 30 Minute Clinic closed, Dr. Schock continued to
work at the MMC clinic in Maumelle, as he had prior to the
opening of the 30 Minute Clinic.
His income varied from week
to week while he worked for MMC based on the number of
patients he saw.
He sought out other employment in September
or October of 2010 in order to even out his income and obtain
better benefits; and he had no hard feelings against MMC. Dr.
Schock was in bankruptcy in 2010.
MMC has not suffered any
liability to Dr. Schock was a result of the cancellation of
II. Standard of Review
In determining whether summary judgment is appropriate, the
burden is placed on the moving party to establish both the absence
of a genuine issue of material fact and that it is entitled to
judgment as a matter of law. See Fed. R. Civ. P. 56(c); Matsushita
Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87
(1986); Nat’l. Bank of Commerce of El Dorado, Ark. v. Dow Chem.
Co., 165 F.3d 602 (8th Cir. 1999).
The Court must review the facts
in a light most favorable to the party opposing a motion for
summary judgment and give that party the benefit of any inferences
that logically can be drawn from those facts. Canada v. Union Elec.
Co., 135 F.3d 1211,
1212-13 (8th Cir. 1998) (citing Buller v.
Buechler, 706 F.2d 844, 846 (8th Cir. 1983)).
Once the moving party demonstrates that the record does not
disclose a genuine dispute on a material fact, the non-moving party
may not rest upon the mere allegations or denials of his pleadings,
but his response, by affidavits or as otherwise provided in Rule
56, must set forth specific facts showing that there is a genuine
issue for trial. Ghane v. West, 148 F.3d 979, 981 (8th Cir.
1998)(citing Burst v. Adolph Coors Co., 650 F.2d 930, 932 (8th Cir.
In order for there to be a genuine issue of material fact,
the non-moving party must produce evidence “such that a reasonable
jury could return a verdict for the nonmoving party.” Allison v.
Flexway Trucking, Inc., 28 F.3d 64, 66 (8th Cir. 1994) (quoting
Furthermore, “[w]here the unresolved issues are primarily legal
rather than factual, summary judgment is particularly appropriate.”
Aucutt v. Six Flags Over Mid-America, Inc., 85 F.3d 1311, 1315 (8th
Cir. 1996)(quoting Crain v. Bd. of Police Comm’rs, 920 F.2d 1402,
1405-06 (8th Cir. 1990)).
Sections 1981 and 1982 protect citizens’ rights to make and
enforce contracts and purchase both personal and real property
A plaintiff establishes a prima facie case under
§ 1981 by showing (1) membership in a protected class; (2) the
intent to discriminate on the basis of race on the part of the
defendant; and (3) discrimination interfering with a protected
activity (i.e., the making and enforcement of contracts).
v. Stein Mart, Inc., 354 F.3d 835, 839 (8th Cir. 2004).
facie elements of a § 1982 case parallel those of a § 1981 case and
require that a plaintiff show (1) membership in a protected class;
(2) discriminatory intent on the part of the defendant; and (3)
ownership of property. See Zhu v. Countrywide Realty Co., Inc., 165
F. Supp.2d 1181, 1199 (D. Kan.2001);
Daniels v. Dillard's, Inc.,
373 F.3d 885, 887 (8th Cir. 2004).
Plaintiff alleges Defendant violated these laws by terminating
the Lease due to Plaintiff’s customers being African American.
discriminatory intent by Defendant.
The undisputed evidence shows
Hispanic population and the opening of the 30 Minute Clinic did not
change the demographics of the store’s patrons.
employee, Brenda Lee, who reported what she considered suspicious
activity by Clinic patrons, is African American as is Dr. Agwunobi,
who made the final decision to terminate the lease.
Accordingly, Defendant’s Motion for Summary Judgment is GRANTED
as to Plaintiff’s §§ 1981 and 1982 claims, and they are DISMISSED
Further, as the elements are the same under ACRA,
this claim is also DISMISSED WITH PREJUDICE.
B. Breach of Contract
Walmart terminated the Lease with MMC on May 28, 2010, due to
“conduct its business, at a minimum, in an
efficient, first-rate and reputable manner”; use of the premises to
conduct an illegal business; failure to conduct its business in a
professional manner; and failure to comply with all federal and
Plaintiff argues there is no proof that Poole was ever
notified of any problem other than the prescribing issue and the
crowd issue and that he resolved both of those.
Plaintiff failed to identify a provision in the Lease that
requires notice and an opportunity to cure for a material breach of
the Lease, and the Court finds none. Plaintiff does not address all
of the other concerns Walmart had about the way the clinic’s
business was being conducted as set forth in the undisputed facts
other than to make unsupported allegations that Walmart simply
wanted to close the Clinic because it served African Americans.
The Court finds there are no genuine issues of material fact
as to whether MMC materially breached the Lease with Walmart.
Accordingly, Defendant’s Motion for Summary Judgment is GRANTED, and
this claim is DISMISSED WITH PREJUDICE.
C. Tortious Interference
For a claim of tortious interference, Plaintiff must prove: (1)
interference inducing or causing a breach of the relationship by the
defendant; (4) damage to the party whose relationship has been
disrupted; and (5) improper conduct by the defendant.
Fairfield Bay Community Club, Inc., 346 Ark. 270, 276, 58 S.W.3d
324, 329 (2001).
Whether a defendant’s conduct is improper, is
evaluated by seven factors.
Vowell, 346 Ark. at 277, 58 S.W.3d at
329. Those factors are: “(1) the nature of the actor's conduct; (2)
the actor's motive; (3) the interests of the other with which the
actor's conduct interferes; (4) the interests sought to be advanced
by the actor; (5) the social interests in protecting the freedom of
action of the actor and the contractual interests of the other; (6)
interference; and (7) the relations between the parties.” Id.
In its brief, Plaintiff merely argues without citing to any
facts in the record that Defendant knew MMC had contracted with
Schock “to operate the 30 Minute Clinic and possibly others.”
that Defendant’s “unwarranted, racially based closing of the 30
Minute Clinic destroyed the contract.”
As previously stated, MMC’s
allegations that Walmart terminated the lease due to the race of the
Clinic’s patrons is unsupported by the record.
MMC failed to show
any improper motive on behalf of Walmart in terminated the Lease.
No genuine issues of material fact exist concerning Plaintiff’s
Intentional Interference claim, and this claim is DISMISSED WITH
Based on the foregoing, the Court determines Defendant’s Motion
for Summary Judgment (doc. 105) is GRANTED. Plaintiff’s claims are
Dismissal of Counterclaim (doc. 121) is GRANTED, and Defendant’s
Counterclaim is DISMISSED WITHOUT PREJUDICE.
The parties are to
bear their own fees and costs.
IT IS SO ORDERED this 30th day of November, 2011.
/s/ Robert T. Dawson
Honorable Robert T. Dawson
United States District Judge
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