Omni Healthcare Inc. et al v. Health First, Inc. et al

Filing 372

ORDER denying as moot 346 Motion to Compel ; ruling deferred 355 Motion for Sanctions; denying as moot 358 Motion in Limine; granting in part and denying in part 361 Motion to modify. Signed by Judge Roy B. Dalton, Jr. on 1/24/2017. (VMF)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
OMNI HEALTHCARE INC.;
INTERVENTIONAL SPINE INSTITUTE
OF FLORIDA; CRAIG DELIGDISH;
C. HAMILITON BOONE, PA; BRIAN
DOWDELL; RICHARD GAYLES; STAN
GOLOVAC; LANCE GRENEVICKI;
ALEKSANDER KOMAR; SCOTT
SEMINER; INSTITUTE OF FACIAL
SURGERY, INC.; THE PAIN
INSTITUTE INC.; and PHYSICIAN
ASSISTANT SERVICES OF FLORIDA,
LLC,
Plaintiffs,
v.

Case No. 6:13-cv-1509-Orl-37DCI

HEALTH FIRST, INC.; HOLMES
REGIONAL MEDICAL CENTER, INC.;
HEALTH FIRST PHYSICIANS, INC.;
HEALTH FIRST HEALTH PLANS, INC.;
MICHAEL D. MEANS; and JERRY
SENNE,
Defendants.
ORDER
This cause is before the Court on the following:
1.

Whatley Kallas, LLP’s Motion to Compel Arbitration, Response to
Emergency Motion of the Boone Plaintiffs, and Incorporated Memorandum
of Law (Doc. 346), filed November 21, 2016;

2.

Plaintiffs’, Omni Healthcare, Inc., Interventional Spine Institute of Florida,
Craig Deligdish, MD, Brian Dowdell, MD, Richard Gayles, MD, Stanley
Golovac, MD, Scott [Seminer], MD, and The Pain Institute, Inc., Motion to

Exclude the Testimony of Michael H. Slotkin (Doc. 358), filed December 22,
2016;
3.

Plaintiffs C. Hamilton Boone, P.A., Lance Grenevicki, M.D., Aleksander
Komar, M.D., the Institute of Facial Surgery, Inc.; and Physician Assistant
Services of Florida, LLC[’s] Response to Motion in Limine to Exclude
Dr. Slotkin’s Testimony and Incorporated Memorandum of Law (Doc 364),
filed December 30, 2016;

4.

Omni Plaintiffs’ Motion to Modify Court’s Order on Defendants’ Emergency
Motion for Order Preventing Distribution of Settlement Proceeds and
Opposition to that Motion and Incorporated Memorandum of Law
(Doc. 361), filed December 29, 2016;

5.

Health First Defendants’ Memorandum in Opposition to Plaintiffs’ Motion to
Modify Court’s Order on Defendants’ Emergency Motion for Order
Preventing Distribution of Settlement Proceeds (Doc. 368), filed January 12,
2017;

6.

Plaintiffs’, Omni Healthcare, Inc., Interventional Spine Institute of Florida,
Craig Deligdish, MD, Brian Dowdell, MD, Richard Gayles, MD, Stanley
Golovac, MD, Scott [Seminer], MD, and The Pain Institute, Inc., Motion for
Sanctions (Doc. 355), filed December 20, 2016;

7.

Plaintiffs C. Hamilton Boone, P.A., Lance Grenevicki, M.D., Aleksander
Komar, M.D., the Institute of Facial Surgery, Inc., and Physician Assistant
Services of Florida, LLC[’s] Response to Motion for Sanctions and
Incorporated Memorandum of Law (Doc. 362), filed December 30, 2016;

2

8.

Plaintiffs C. Hamilton Boone, Lance Grenevicki, Aleksander Komar,
Institute of Facial Surgery, and Physician[] Assistant Services of Florida’s
January 5, 2017 Hearing Brief for Plaintiffs’ Distribution of Proceeds
(Doc. 353), filed December 9, 2016;

9.

Plaintiffs’ (Omni Healthcare, Inc., Interventional Spine Institute of Florida,
Craig Deligdish, MD, Brian Dowdell, MD, Richard Gayles, MD, Stanley
Golovac, MD, Scott [Seminer], MD, and The Pain Institute, Inc.) Trial Brief,
Witness List[,] and Exhibit List (Doc. 359), filed December 22, 2016; and

10.

Other matters heard at the Court’s January 5, 2017 evidentiary hearing (see
Doc. 367).
BACKGROUND

Plaintiffs initiated the instant antitrust action on September 27, 2013. (Doc. 1.) On
the morning of the second day of trial, the parties announced in open court that they had
reached a settlement (“Settlement Announcement”). (See Doc. 326.) That same day,
the Court dismissed the action—subject to the right of any party to move the Court within
sixty days for the purpose of entering a stipulated form of final order or judgment or, on
good cause shown, to reopen the case for further proceedings. (Doc. 329 (“Sixty Day
Order”).) After moving to extend the deadline set forth in the Sixty Day Order multiple
times (Docs. 331, 333, 336), a subset of Plaintiffs (“the Boone Plaintiffs”) 1 moved the

1

The Boone Plaintiffs include physician assistant C. Hamilton Boone
(“Mr. Boone”), Lance Grenevicki, M.D. (“Dr. Grenevicki”), Aleksander Komar, M.D.
(“Dr. Komar”), the Institute of Facial Surgery, Inc. (“IFS”), and Physician Assistant
Services of Florida, LLC (“PAS”). (Doc. 338, p. 1.) IFS is a medical practice founded by
Dr. Grenevicki. (Doc. 57, ¶ 22.) Mr. Boone is the only remaining physician assistant at
PAS. (Id. ¶ 258.)

3

Court for equitable distribution of the settlement proceeds, indicating that extra-judicial
efforts to resolve this issue had broken down. (Doc. 338 (“Motion for Equitable
Distribution”).)
The Court held a status conference on the matter on December 1, 2016 (“Status
Conference”). (See Doc. 348.) At the Status Conference, the remaining Plaintiffs (“the
Omni Plaintiffs”) 2 represented that all Plaintiffs had agreed to distribute the settlement
proceeds in proportion to the damages set forth in the report of Plaintiffs’ expert Hal
J. Singer, Ph.D (“Dr. Singer”) (“Allocation Agreement”), while the Boone Plaintiffs
denied the existence of any binding Allocation Agreement. To resolve the dispute, the
Court ordered additional briefing and set an evidentiary hearing for January 5, 2017
(“Evidentiary Hearing”). (See Docs. 348, 350.)
The primary issue for resolution at the Evidentiary Hearing was whether the parties
had reached a binding Allocation Agreement. If not, the Court was poised to consider
additional evidence on equitable damages from the Boone Plaintiffs’ retained damages
witness—Michael H. Slotkin, Ph.D. (“Dr. Slotkin”). At the Evidentiary Hearing, the Boone
Plaintiffs also testified that they never agreed to settle the case prior to the Settlement
Announcement. The Court took these matters under advisement.
STANDARDS
“Settlement agreements are favored as a means to conserve judicial resources[,]
[and] [c]ourts will enforce them when it is possible to do so.” Spiegel v. H. Allen Holmes,

2

The Omni Plaintiffs include OMNI Healthcare, Inc. (“Omni”), Interventional Spine
Institute of Florida, Craig Deligdish, M.D. (“Dr. Deligdish”), Brian Dowdell, M.D., Richard
Gayles, M.D., Stanley Golovac, M.D., Scott Seminer, M.D. (“Dr. Seminer”), and The Pain
Institute, Inc.

4

Inc., 834 So. 2d 295, 297 (Fla. 4th DCA 2002). “Oral settlement agreements are
enforceable

under

both

federal

and

Florida

law,”

Skrtich

v.

Thorton,

No. 3:99-cv-742-J-25HTS, 2003 WL 24845555, at *2 (M.D. Fla. Mar. 28, 2008), and a
district court may enforce such agreements in causes of actions pending before it, H&R
Block E. Enters., Inc. v. Perkins, No. 1:06cv93-SPM/WCS, 2007 WL 1020118, at *7
(N.D. Fla. Mar. 30, 2007); see also Kent v. Baker, 815 F.2d 1395, 1396 (11th Cir. 1987).
“The determination as to whether a binding settlement agreement was reached by the
parties is governed by Florida contract law principles.” Perkins, 2007 WL 1020118, at *7.
The party seeking to compel enforcement of a settlement agreement must
ordinarily demonstrate two things—(1) first, “that [the opposing party’s] attorney had clear
and unequivocal authority to enter into the settlement agreement,” Murchison v. Grand
Cypress Hotel Corp., 13 F.3d 1483, 1485 (11th Cir. 1994); and (2) second, that the
opposing party assented to all the essential terms of the agreement, Spiegel, 834 So. 2d
at 297. In assessing whether the propounding party has made the requisite showing,
courts use an objective standard, under which “[t]he making of a contract depends not on
the agreement of two minds in one intention, but on the agreement of two sets of external
signs—[that is,] not on the parties having meant the same thing but on their having said
the same thing.” Gendzier v. Bielecki, 97 So. 2d 604, 608 (1957) (quoting Oliver Wendell
Holmes, Jr., The Path of the Law, 10 HARV. L. REV. 457, 464 (1897)).
“Where material facts concerning the existence or terms of an agreement to settle
are in dispute, or where there is a material dispute about the authority of an attorney to
enter a settlement agreement on behalf of his client, the parties must be allowed an
evidentiary hearing.” Murchison, 13 F.3d at 1485. “The standard of proof required to

5

enforce a settlement agreement, provided one is found to exist, is merely a
preponderance of the evidence.” Perkins, 2007 WL 1020118, at *7.
DISCUSSION
I.

Agreement to Settle the Action
Though the Boone Plaintiffs attempted to disavow the existence of any agreement

to settle the case, this issue was not properly before the Court at the Evidentiary Hearing.
Importantly, at the Status Conference, the Court directed Plaintiffs to submit written briefs
setting forth the issues, witnesses, testimony, and exhibits that they intended to present
at the Evidentiary Hearing. (Doc. 350, p. 4.) In doing so, the Court advised the parties
that “[a]ny undisclosed issues, witnesses, or documents [would] not be heard, permitted
to testify, or admitted.” (Id. at 4–5.)
Notably, in their hearing brief (“Boone Brief”), the Boone Plaintiffs admit that
“Plaintiffs settled this action with the Defendants but have not been able to agree as to
how distribute the economic proceeds.” (Doc. 353, p. 5.) The Boone Brief also states that
“[t]he sole issue for determination at [the Evidentiary Hearing] [was] how to distribute any
remaining proceeds to each of the Plaintiffs after payment of reasonable attorneys’ fees,
costs, and repayment of the capital provider.” (Id.) The Omni Plaintiffs’ brief sets forth the
same issue for determination. 3 (See Doc. 359) (arguing that the Allocation Agreement be
enforced).
Had the existence of a settlement been properly raised and briefed by the parties,
the Court would have rejected the matter without an Evidentiary Hearing. A similar issue

3

Additionally, the Omni Plaintiffs request an award of costs and fees incurred as
a result of the Boone Plaintiffs’ contentions. (Doc. 359, p. 18.)

6

was presented to the U.S. Court of Appeals for the Eleventh Circuit in Murchison v. Grand
Cypress Hotel Corporation, 13 F.3d 1483 (11th Cir.1994), where “[a]fter acquiescing to a
settlement agreement [that] was read in open court, the [a]ppellant . . . contend[ed] that
he did not consent to the agreement and that his attorney was not authorized to enter into
the settlement agreement.” 13 F.3d at 1484. Here, as in Murchison, the existence of an
agreement to settle is not in genuine dispute. Rather, both parties represented in open
court—without objection—that an agreement to settle had been reached. Thus, an
evidentiary hearing with respect to the existence of a settlement was not required. See
Murchison, 13 F.3d at 1487 (reaching the same conclusion “where both parties
represented that an agreement had been reached, and the agreement was read into open
court without objection from either party”).
Moreover, in Murchison, the Eleventh Circuit disagreed with the appellant’s
contention that “it was inappropriate for the district court to assume that his silence
indicated approval.” Id. In rejecting this argument, the court pointed out that:
(1) Murchison was an educated man who understood the terms of the settlement
agreement; (2) he was present when the agreement was announced in open court; and
(3) “[i]f he was unhappy with the settlement agreement, then he should have objected at
the time that it was read into open court.” Id. Though the instant action presents slightly
different circumstances—as the terms of the settlement agreement were not read into the
record—the principles laid out in Murchison are readily applicable here. Most importantly,
settlement was announced in open court. Had the Boone Plaintiffs not agreed to settle,
nothing prevented them from communicating their disagreement to the Court. Indeed,
simple logic belies the contention that the Boone Plaintiffs, as educated medical

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practitioners, did not understand the ramifications of such an announcement.
II.

Allocation Agreement
As to the Allocation Agreement dispute, the Omni Plaintiffs were charged with

demonstrating—by a preponderance of the evidence—that the Boone Plaintiffs had
assented to all essential terms of the agreement. See Perkins, 2007 WL 1020118, at *7.
To meet their burden, the Omni Plaintiffs called several witnesses to testify to the
existence of the Allocation Agreement, including attorneys Joe Whatley, Damien Prosser,
and Deborah Winegard, who had served as counsel for all Plaintiffs in this action.
Drs. Deligdish and Seminer also testified that all Plaintiffs had assented to the Allocation
Agreement. In rebuttal, the Boone Plaintiffs presented testimony from Mr. Boone, 4
Dr. Komar, and Dr. Grenevicki, who denied the existence of a final Allocation Agreement.
Most notably, the Omni and Boone Plaintiffs elicited testimony regarding an e-mail
chain sent between the individual Plaintiffs 5 in November of 2015 (“November 2015
E-mail Chain”). The portion of the November 2015 E-mail Chain submitted to the Court
contains four e-mails sent by: (1) Dr. Deligdish on November 19, 2015 (“First E-mail”);
(2) Mr. Boone on November 20, 2015 (“Second E-mail”); (3) Dr. Komar on November 20,
2015 (“Third E-mail”); and (4) Dr. Deligdish on November 20, 2015 (“Fourth E-mail”). In
the First E-mail, Dr. Deligdish wrote:
This is what I plan to send to the attorneys. Any edits or
suggested changes?
The clients met tonight with John Kancilla and agreed to the
4

Mr. Boone was also called to testify during the Omni Plaintiffs’ presentation of
evidence.
5 The term “individual Plaintiffs” excludes the entity Plaintiffs. Each entity, however,
was represented in this action by an individual Plaintiff who either owned or operated the
attendant medical practice.

8

following:
They will mediate as a group and settle as a group based on
the overall percentage of their damages determined by Hal
Singer’s reports. The plaintiffs would like to know how much
has been expended thus far in fees and costs and how much
will need to be recovered for them to net 100% of their
damages. They would like to know the sum total of the
damages, and each plaintiff would like to know his percentage
of the total. Additionally, the plaintiffs would like to meet with
the attorneys at 8am on the day of mediation to discuss
strategy.
Mr. Boone responded with the Second E-mail, saying: “Looks good. How about meeting
over breakfast?”
In the Third E-mail, Dr. Komar wrote:
I would like to include that settlement should require
unanimous decision . . . Also, I would suggest little different
formula than simple percentage of the damages. Since we all
accepted the risk of litigation, I would recommend formula of
x% of base plus percentage of damages. Open to discussion.
Finally, Dr. Deligdish responded with the Fourth E-mail, stating:
I agree we should discuss. I think there is room for
compromise, i.e. a super majority i.e. 80% of the entities and
80% of the damages. There are some folks who want to
participate in HFHP, as well, as a potential condition, for
settlement. Others may have other wishes, i.e. conduct that
does not restrict competition.
While the Omni Plaintiffs proffered the First and Second E-mails as evidence of
Mr. Boone’s assent to the Allocation Agreement, the Boone Plaintiffs focused on the Third
and Fourth E-mails as evidence that no final agreement had been reached between
Plaintiffs regarding how to allocate the damages upon settlement. The witnesses gave
the following testimony with respect to the intended meaning of such e-mails.
•

With respect to the Second E-mail, Mr. Boone testified that he only intended to

9

signify that the First E-mail was a good starting point for future discussions,
such that Dr. Singer’s report could be used as a base line for determining how
to allocate damages.
•

When questioned about the Third E-mail, Dr. Deligdish reiterated that
Dr. Komar: (1) assented to the Allocation Agreement in multiple meetings
witnessed by counsel and the other Plaintiffs; (2) directly communicated such
assent to Dr. Deligdish; and (3) never discussed the issues raised in the Third
E-mail again. Dr. Seminer corroborated this testimony.

•

On direct examination regarding the Third E-mail, Dr. Komar testified that
although he had engaged in several discussions with the other Plaintiffs as to
how eventual proceeds would be divided, he never agreed to divide proceeds
based solely on the allocation of damages in Dr. Singer’s report.

•

Dr. Deligdish testified that the Fourth E-mail referenced his suggestions for:
(1) requiring only a supermajority for agreement to settle rather than unanimity;
and (2) the non-financial conditions of settlement.

As articulated by the Florida Supreme Court, it is of no moment what subjective
meaning the parties attributed to such e-mails if their outward manifestation indicated
otherwise. Gendzier, 97 So. 2d at 608 (“The making of a contract depends not on the
agreement of two minds in one intention, but on the agreement of two sets of external
signs—[that is,] not on the parties having meant the same thing but on their having said
the same thing.”). As such, Mr. Boone’s response in the Second E-mail evidences his
assent to the Allocation Agreement, as it is devoid of any qualifying language. And while
the Third and Fourth E-mails may evidence an intention to continue discussions

10

concerning allocation approaches, five witnesses testified that all Plaintiffs communicated
unequivocal assent to the Allocation Agreement after November 20, 2015.
Thus, upon consideration, the Court finds that the greater weight of the evidence
establishes the existence of a binding Allocation Agreement between all Plaintiffs. In
accordance with the testimony presented at the Evidentiary Hearing, the Court also finds
that Plaintiffs modified the Allocation Agreement to allocate damages in proportion to the
midpoint of the damage ranges set forth Dr. Singer’s report. In so concluding, the Court
finds that, given the weight of the evidence supporting the existence of the Allocation
Agreement—inclusive of the corroborating E-mails in the November 2015 E-mail Chain—
the contrary evidence presented by the Boone Plaintiffs was not credible. 6
III.

Battle of the Experts
Having determined the existence of an enforceable Allocation Agreement based

on Dr. Singer’s report, the Court declines to consider evidence from the Boone Plaintiffs’
competing expert, Dr. Slotkin. Accordingly, the Omni Plaintiffs’ pending motion in limine
is due to be denied as moot. The Court writes separately only to note that Dr. Singer’s
report memorializes his opinion of the damages to be attributed to each Plaintiff; it is not
necessary that everyone agree with his opinion. The Boone Plaintiffs’ untimely,
after-the-fact criticisms of Dr. Singer’s report are nothing short of Monday morning
quarterbacking and are entirely irrelevant to the existence of an Allocation Agreement. At
the end of the day, the Allocation Agreement reflects a compromise inherent in

6

Also pending before the Court is Whatley Kallas, LLP’s motion to compel
arbitration of matters raised by the Motion for Equitable Distribution. (Doc. 346 (“Motion
for Arbitration”).) Upon review, the Court finds that these matters have been now been
resolved. As such, the Motion for Arbitration is due to be denied as moot.

11

settlement—that some will gain at the expense of others to reach an outcome that
outweighs the cost of litigation. In this regard, the Boone Plaintiffs’ post-settlement regrets
are reminiscent of the unsavory squabbling of dissatisfied heirs over the inheritance of
the departed. As aptly expressed by the Eleventh Circuit, courts “favor and encourage
settlements in order to conserve judicial resources [and] cannot allow a litigant to attack
the integrity of the settlement process by attempting to recharacterize the focus of his
litigation after he decides he is unhappy with the settlement.” Murchison, 13 F.3d at 1487.
However, the Court is mindful of the Boone Plaintiffs’ concerns with respect to the
potential double counting of damages between Dr. Deligdish, Dr. Seminer, and Omni—
issues also alleged to have been addressed in Dr. Singer’s report. 7 To the extent that the
parties cannot agree on the resolution of this issue, the parties shall submit such
disagreement to Judge Gary A. Fees, with each party to bear his own cost and fees.
IV.

Miscellaneous Matters
Next, the Court wishes to address a number of meritless arguments advanced in

the Boone Brief. First, the Boone Plaintiffs argued that they were entitled to an equal
one-thirteenth share of the settlement proceeds after payment of counsel, costs, and the
capital provider (“Equal Distribution Argument”). (Doc. 353, p. 5.) However, given the
disparity between Plaintiffs’ damages in this action, this argument strains credulity and,
at the Evidentiary Hearing, counsel for the Boone Plaintiffs conceded this point. At bottom,
such an allocation would never have come to fruition had this action proceeded through
trial and would not have been just under the circumstances.

7

(See also Doc. 199-1, pp. 32–33 (providing Dr. Singer’s deposition testimony in
response to Defendants’ inquiries as to the double counting of damages).)

12

Second, the Boone Plaintiffs argued that the Allocation Agreement was barred by
Florida’s Statue of Frauds because it was incapable of being performed within one year
(“SOF Argument”). (Id. at 6–7.) But according to the testimony adduced at the
Evidentiary Hearing, Plaintiffs assented to the Allocation Agreement just prior to
participating in mediation on December 2, 2015. Thus, had the parties settled at
mediation, the Allocation Agreement could have been performed within a year. And but
for the instant proceeding, the Allocation Agreement could have been performed shortly
after the Settlement Announcement on August 16, 2016—well within a year’s time. Under
Florida law, if it is possible to perform an oral contract of indefinite duration within one
year of its inception, then it falls outside the statute of frauds. Browning v. Poirier,
165 So. 3d 663, 666 (Fla. 2015). Not only did the Boone Plaintiffs fail to address this
binding Florida precedent in their hearing brief, they demonstrated no reasonable basis
for avoiding it. Rather, the Boone Brief contains one conclusory statement—unsupported
by either argument or fact—that “none of the Plaintiffs could have reasonably believed
that this action could possibly be completed in one year.” (Doc. 353, p. 6.) This is
insufficient to render their SOF Argument anything but frivolous on its face.
Consistent with the Court’s prior Order, the Boone Plaintiffs—as the losing party—
will be obligated to pay the costs and fees associated with the Evidentiary Hearing.
(Doc. 350, p. 5.) To this end, the Omni Plaintiffs have moved for sanctions under Federal
Rule of Civil Procedure 11 and 28 U.S.C. § 1927, contending that the Boone Plaintiffs:
(1) knowingly advanced frivolous factual claims; and (2) unreasonably and vexatiously
multiplied the proceedings. (Doc. 355 (“First Motion for Sanctions”).) 8 The Boone
8

On January 19, 2017, Plaintiffs collectively filed a second motion for sanctions

13

Plaintiffs responded to the First Motion for Sanctions on December 30, 2016. (Doc. 362.)
At this juncture, the Court elects to defer ruling on the Omni Plaintiffs’ First Motion for
Sanctions until it has received briefing on the costs and fees associated with the
Evidentiary Hearing. The Omni Plaintiffs shall submit this briefing within fourteen days of
this Order. 9 Such expenses shall be measured from November 15, 2016—the date that
the Boone Plaintiffs filed their Motion for Equitable Distribution. Thereafter, the Boone
Plaintiffs will have fourteen days to respond. The Boone Plaintiffs’ brief should also
respond to the Court’s conclusion that the Equal Distribution and SOF Arguments lack
merit on their face, as this finding may also form the basis for sanctions against counsel.
V.

Authorization for Distribution of Settlement Proceeds
As a final matter, additional disputes have arisen between the parties with respect

to the authorization required for distribution of the settlement proceeds. Following the
Status Conference, the Court directed Defendants to transfer the settlement proceeds to
an escrow agent agreed to by the parties. (Doc. 350, p. 4.) Implicit in this Order was the
understanding that such funds would be held in escrow pending resolution of the
allocation dispute.
Arguing that the settlement of this action was contingent on the settlement of a

against Defendants Health First, Inc., Health First Physicians Inc., Health First Health
Plans, and Holmes Regional Medical Center, Inc. (“Corporate Defendants”). (See
Docs. 370, 371.) The Court will take up this motion after a response is filed.
9 The Omni Plaintiffs, however, are not permitted to seek reimbursement for fees
associated with their motion in limine, which is largely premised on the contention that the
Boone Plaintiffs failed to comply with the requirements of Rule 26 prior to proffering
Dr. Slotkin’s testimony. (Doc. 358 (“Motion in Limine”).) Rule 26 is applicable to trial—
not evidentiary hearings; further, the Boone Plaintiffs discussed the possibility of expert
testimony at the Status Conference, without objection from the Court. As such, the Court
finds that the Motion in Limine was an unnecessary expenditure and should not be
included in any request for reimbursement.

14

related qui tam action 10 (“Qui Tam Action”), on December 15, 2016, the Corporate
Defendants filed a motion requesting that the settlement proceeds be held in escrow
pending resolution of a separate dispute in the Qui Tam Action. (Doc. 354 (“December 15
Motion”).) In an abundance of caution, the Court granted the December 15 Motion in part
and prohibited the escrow agent from distributing any funds without a Court Order.
(Doc. 356 (“December 21 Order”).) It was later revealed that, under the terms of the
parties’ settlement agreement, the settlement funds could be withdrawn or distributed
from the escrow account upon “stipulation of the [P]laintiffs or further order of the Court”
(“Distribution Provision”) (Doc. 361-1, p. 361.) As such, the Omni Plaintiffs moved for
modification of the December 21 Order due to its conflict with the Distribution Provision.
(Doc. 361.)
As stated at the Status Conference, the Court rejects the Corporate Defendants’
contention that the settlement of this action was in any way contingent on the settlement
of the Qui Tam Action. Indeed, at the time of the Settlement Announcement, such
contingency was never communicated to the Court. Thus, while the purpose of the
December 21 Order was to maintain the status quo pending the resolution of the
allocation dispute, it was not the Court’s intention to suggest that its embargo on the
distribution of settlement funds was necessarily coextensive with the ultimate resolution
of disputes in the Qui Tam Action.
Notwithstanding the Distribution Provision, however, prudence dictates that the
Court maintain the status quo until further notice. Hence the settlement proceeds shall
remain in escrow until all strings are tied in this action, including the resolution of the First
10

See United States ex rel. John Doe v. Health First, Inc., 6:14-cv-501-Orl-37DCI.

15

Motion for Sanctions any any disagreement over the double counting of damages for
Dr. Deligdish, Dr. Seminer, and Omni.
CONCLUSION
Accordingly, it is hereby ORDERED AND ADJUDGED that:
1.

A preponderance of the evidence establishes that Plaintiffs agreed to
allocate settlement proceeds in proportion with the damages assigned to
each Plaintiff in Dr. Hal Singer’s damages report. Pursuant to their
agreement, where a range of damages appears in the report, Plaintiffs shall
allocate their damages at the midpoint of such range.

2.

To the extent that Plaintiffs are unable to resolve their dispute regarding the
alleged double counting of damages, Plaintiffs are DIRECTED to submit
this dispute to Judge Gary A. Fees.
a.

Each party shall bear its own costs and fees.

b.

Plaintiffs are DIRECTED to notify the Court: (1) once this dispute is
resolved; or (2) if it is no longer at issue.

3.

Whatley Kallas, LLP’s Motion to Compel Arbitration, Response to
Emergency Motion of the Boone Plaintiffs, and Incorporated Memorandum
of Law (Doc. 346) is DENIED AS MOOT.

4.

The Court DEFERS RULING on Plaintiffs’, Omni Healthcare, Inc.,
Interventional Spine Institute of Florida, Craig Deligdish, MD, Brian Dowdell,
MD, Richard Gayles, MD, Stanley Golovac, MD, Scott [Seminer], MD, and
The Pain Institute, Inc., Motion for Sanctions (Doc. 355) pending receipt of:
a.

the Omni Plaintiffs’ submission of the costs and fees associated with

16

the Evidentiary Hearing;
b.

the Boone Plaintiffs’ response to submission of the Omni Plaintiffs’
costs and fees; and

c.

the Boone Plaintiffs’ response to the Court’s findings on the merits of
their Equitable Distribution and SOF Arguments.

d.

The parties are DIRECTED submit such briefing in accordance with
the timeline set forth in this Order.

5.

Plaintiffs’, Omni Healthcare, Inc., Interventional Spine Institute of Florida,
Craig Deligdish, MD, Brian Dowdell, MD, Richard Gayles, MD, Stanley
Golovac, MD, Scott [Seminer], MD, and The Pain Institute, Inc., Motion to
Exclude the Testimony of Michael H. Slotkin (Doc. 358) is DENIED AS
MOOT.

6.

Omni Plaintiffs’ Motion to Modify Court’s Order on Defendants’ Emergency
Motion for Order Preventing Distribution of Settlement Proceeds and
Opposition to that Motion and Incorporated Memorandum of Law (Doc. 361)
is GRANTED IN PART AND DENIED IN PART.
a.

The Court CLARIFIES that its embargo on the withdrawal of
settlement proceeds from escrow is not coextensive with the
resolution of pending matters in the related Qui Tam Action.

b.

In all other respects, the motion is DENIED.

DONE AND ORDERED in Chambers in Orlando, Florida, on January 24, 2017.

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Copies:
Counsel of Record

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