THE MOSES H. CONE MEMORIAL HOSPITAL OPERATING CORPORATION v. SPRINGFIELD SERVICE CORPORATION

Filing 212

MEMORANDUM OPINION AND ORDER signed by MAG/JUDGE JOE L. WEBSTER on 4/11/2017; that Cone Health's Motion for Partial Summary Judgment (Docket Entry 100 ) is GRANTED IN PART AND DENIED IN PART, and Conifer's Motion for Partial Summary Judgment (Docket Entry 103 ) is DENIED. (Sheets, Jamie)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
THE MOSES H. CONE MEMORIAL
HOSPITAL OPERATING
CORPORATION d/b/a CONE
HEALTH,

)
)
)

)
)
Plaintiff,
)
)
v.
)
)
CONIFER PHYSICIAN SERVICES, INC. )
f /k/ a SPRINGFIELD SERVICE
)
CORPORATION,
)
)
Defendant.
)

1,:73CY651,

MBMORANDUM OPINION AND ORDER
This matter is before the Court upon Plaintiff, The Moses H. Cone Memorial Hospital
Operating Cooperation's ("Cone Health") motion fot parlJral summary judgment pocket

Etrtry 100), and Defendant Conifet Physician Services, Inc.'s ("Conifet") motion for parttal
summary judgment. (Docket E.rtry 103.) Both matters have been fully briefed and ate tipe

for disposition. For the reasons stated hetein, the Court wrll deny Conifet's motion for partj;al
summary judgment and grant

in part and deny in patt Cone Health's motion for pattal

summary judgment.l

By consent of the parties, this matter has been tefered to the undersþed putsuant to 28 U.S.C. $
636(c),to conduct all proceedings including a jary or.nonjury trial, to order the entry of judgment, and
to conduct all post-judgment proceedings therein. (Jøe Docket Entry 59.)
1

I.

BACKGROUND
Cone Health fìled its original complaint on August 8, 201.3, allegrng that Conifer

breached

the parties' Mastet Outsourcing

Services ,\greement

("Agreement") and that Cone Health was terminating the Agteement

breach.

(Sæ generalþ

Compl., Docket Entry

1.)

and Supplement 1

^s

a result

of Conifer's

Cone Health alleged a clatm fot breach

of

contract (and the supplement) (Counts I and II), and also alleged five sepatate câuses of action

for declaratory judgment (Counts
dismiss Counts

III

through

III through VII). (Id.nfl75-96.)

Conifet filed a motion to

VII of the Complaint. (Docket E.rt y 10.) The Court theteaftet

granted Conifer's motion Q)ocket E.rtry 27), and the parties submitted a Joint Rule 26(f)

Repot which the Court adopted. Q)ocket Entries 28,30.) ,{.ftet discovery commenced, Cone
Health filed a consent motion to amend its Complaint, which was granted. pocket Entdes

39,42.) After the Amended Complaint was filed Q)ocket Entry 45), Conifer answered and
assetted

a countetclaim agaitst Cone Health. (Docket Entry 48.) Theteaftet

discovery took place in this matter and both panies submitted motions

extensive

fot partial summalT

judgment. (Docket Entdes 100, 103.) In its motion, Cone Health seeks parttal summâly
judgment as to damages on Conifer's counterclaim. (Docket Entry 100.) Conifer's motion
seeks

pattial summary judgment as to: (1) liability on its counterclaim, Q) all claims fot relief in

Cone Health's Amended Complaint except the claim

fot

a performance adjustment; (3) and

other relief the Court finds appropdate. (Docket Entry 103.)

Accotding to the Amended Complaint, Cone Health ptovides health care services
thtough a netwotk of hospitals and physicians in

Noth

Carclirra. (Am. Compl.

I

5, Docket

Entry 45.) Conifer provides revenue management, health information management, and

2

billing services to health care providets like Cone Health.2 (Id, ÍT6.) On August8,20L1, Cone
Health and Conifer enteted into â Master r\gteement (the "Agteement") undet which Cone
Health outsourced certain claims management and accounts receivable functions to Conifer.
Qd.nn 9-10; Master Agreement

& Supplements, Ex. A, Docket Entty 45-1,.) Thereaftet,

the

parties executed "supplement 1" to the Agteement, undet which Conifet began ptoviding

billing and claims management services to physicians owned by,

or

affthated,

with, Cone

Health. (Suppl. 1, Ex. Aat32-33.) The term of the,A.gteement undet Supplement
years

ftom the commencement date of Supplementl,. (Id.

1 was five

^t32.)

On May 1.0,201.3, Cone Health notified Conifet of several purponed breaches of the
Agreement and threatened to terminate it for cause as ofJuly 12,201,3. (Am. Compl. fl 58; ree
alsoMay 10 Letter, Ex. A, Docket E.rtty 51-1.) The alleged breaches include Conifer's failute

to ptopetly manage Cone Heath's accounts teceivable ("A'/R"), failute to implement a denial
management team to process denied claims, failute to ptovide adequate customer service to
patients, failure to provide daily reconciliation, and imptoper billing of Medicaid beneficiaries.

(1d.11119-54.) Under the ,{.greement, Cone Health (with wdtten notice) could terminate the
Agreement fot cause

if Conifer failed to fix a material bteach within

Health could terminate

if a material

breach was incutable. Qd. n 56; Master Agreement

1,5.2(a).) The ,A.greement also provided

thtee-yeat annivetsary

sixty (60) days, ot Cone
$

for termination without câuse at any time aftet the

of the Agteement, provided that Cone Health give six (6) months

wtitten notice. (I4aster Agreement $ 15.2(c).) Âfter receiving notice of Cone Health's intent

2

Conifer is formerþ known as "springfield Serwice Coqporation" which did business as "SPi
Healthcare." (A-. Compl. fl 7.) The Amended Complaint tefers to Defendant as "SPï'. This
memorandum opinion tefers to Defendant as "Conifet".
J

to teminate the Agreement, Conifer responded by letter, addressing the issues in the notice
from Cone Health. (Am. Compl.

J[ 59; see aho

May 30 Letter, Ex. B, Docket Et tty 51,-2.)

Cone Health concluded that Conifer did not have the ability to cure its breaches, nor
had Conifet remedied the issues raised in the May 10 letter. (Id.1160.) Cone Health agreed to
suspend its termination notice until August1.2,201.3, to allow the patties to discuss termination

transition resolutions

.

(Id.1163.) Cone Health then filed this action on August 8,20L3, alleging

that Conifer breached the Agreement.

Conifer fi.led an Answer and also asserted a counterclaim in this action alleging that
Cone Health's termination was imptoper, and thus, abreach of the Agreement. (Counterclaim

tf 3, Docket Entry 48 at
Agreemen

t

and,

7.) Conifer

alieges that

it was (1) never in material breach of

the

Q) that it cured, or offered to cure any purported breach before Cone Health

terminated the Agreemerrt. (Id.) Conifer seeks compensatory damages in excess of $20 million

dollats. Qd.1146.)
Some background undisputed facts

^re ^s

follows:3 Cone health was initially struggling

with revenue cycle performance prior to the execution of the ,{,gteement. (I(enneth Boggs
Dep., Ex. 5 47:5-48'5, Docket Entry 105-4 at 7.) Revenue cycle functions include scheduling,

tegisttation, billing

fot medical services, collecting

payment, account adjustments, and

33.) Cone Health's in-house struggles
collections follow-up. @*. 2, Docket Entry 105-1
^t
with billing and collection services were primarily the tesult of staffing issues. (Boggt Dep.,

3

Both paties have ptesented extensive evidence, including corporate documents, affidavits and
deposition testimony which demonstrate an extensive histotical wotking relationship from a time
pedod ptior to the execution of the Agreement through the filing of this civil action. The Coutt need
not naffate every detailed factual allegation as the parties are intimately famthar. with such infotmation.
To the extent necessâly, the Court will address facts pertinent to the legal atguments presented herein.
4

Ex. 5 47:8-12.) In 2010, Cone Health decided to change its electtonic healthcate records
system ftom the

6

44:1.9-25,

"GE/IDX" platform to the "EPIC" platform.

Docket Entty 105-4

^t

(Vfatk R. Gotham Dep., Ex.

1,6.) EPIC was set to go "live" on February 1,201,2. Qd

73:12-1.9.) As part of Cone Health's efforts to improve revenue cycle functions, it aiso entered

into the Agreement with Conifet. Conifet begin services on the GE/IDX system and latet
moved to the EPIC system. (Jeø Suppl. 1, S VI.) Conifer's services included

A/R follow-up,

payment posting, ând customer sewice. (Ex. 8, Docket Etttty L05-4 at 65-66.) Cone health
was still tesponsible

fot some revenue cycle functions.

(1/.)

ïíhat transpired (and why it transpired) aftet Conifet begin performing undet
Agreement is the root of considerable disagteement, but

it is cleat that by early

the

2013, Cone

Health was unsatisfied with Conifers' perfotmance and intended to tetminate its agreement
with Conifer. Cone Health hired another revenue cycle management company in March 20L3,
Alleviant, and on Apdl 1.8,201.3, a Cone Health executive, Jefftey F. Jones, contacted Conifet's
executive, John O'Donnell, regarding terminating the Agteement. (|effrey Jones Dep., F;x.7 6
271,:1.-272:20:,

Docket Entry

1,2'1,-1,5

^t

1,3-1,4.)

Mr. O'Donnell wanted something in wtiting

and on May 10, 201.3, Mr. Jones sent a ietter to Conifer regarding Cone Health's grounds for

termination (tvluy 10 Letter

^t

2-3.) Thereaftet, Conifer provided â response to the issues

raised in the letter whereby Conifer denied that Cone Health could tetminate the Agteement

with cause. (NIuy 30 Letter

^t

2-7.) Cone Health v/tote a follow-up lettet on June 14,201.3

expressing futthet disagreement. $une 14Letter,Ex. C, Docket

then filed the pending action against Conifet in August 201,3.

5

Ettty 51-3.)

Cone Health

II. DISCUSSION
Both parties have moved for pattalsummary judgment in this matter. pocket Entries
100, 103.) Summary judgment is appropriate when there exists no genuine issue of material

fact and,the movin g p^rqis entitled to
Zahodnick u.

Int'l

nt

^s ^matter

of law. Fed. R. Civ. P. 56(c);

135 F.3d 91,1,,91,3 (4th Cir. 1997). The party seeking

Bws. Maclt¡. Corþ.,

summarry judgment bears the

judgme

initial butden of coming forwatd and demonsttating the absence

of a genuine issue of material fact.

Ternkin u. Frederick Counfl Comm'rs,945 F.2d71,6,71.8

(4th

Ctr. 1,991) (citing Celotex u. Catrett, 477 U.S. 317 , 322 (1986). Once the moving party has met

its burden, the non-moving patq must then afftmatively demonsttate that thete is a genuine
issue of matedal fact which requires

ttial. Mat¡ashita

E,lec. Indas. Co.

Ltd.

u. Zenith Radio Corp.,

475 U.S. 574,587 (1986). Thete is no issue for tÅaI unless thete is sufficient evidence favodng

the non-moving party for a fact finder to return a verdict fot that p^rty. Anderson

Iabþt, lnc.,477 U.5.242,250 (1986);

S1luia Deu, Corp. u. Calaert Coørufl,

u.

Uber{t

Md.,48 F.3d 810, 817

(4th Cit. 1,995). Thus, the movingpatry can beat his burden eithet by presenting afftmative
evidence or by demonsttating that the non-moving patty's evidence is insufficient to estabüsh
his claim. Celotex,477 U.S. at 331, (Btennan, dissenting). IØhen making the summary judgment

determination, the Court must view the evidence, and all justifìable infetences from the
evidence,

in the light most favorable to the non-moving pafty. Zahodnick, 135 F.3d at 91,3;

Haþerin

Abacas Tech. Corp., 128 F.3d 191, 196 (4th Cir. 1,997). Howevet, the patty opposing

u.

sunìmaly judgment may not rest on mere allegations or denials, and the court need not considet

"unsuppotted assettions" or "self-serying opinions without objective corroboration." Euanr u.
Techs.

Application¡ dv Sera. C0,80 F.3d 954,962 (4th Cir. 1,996); Anderson, 471 U.S.

6

^t

248-49.

"'When faced with cross-motions for summary judgment, the court must review each motion
separately on its own merits

^

m^ttet of lâw."'

'to determine whethet either of the parties deserves judgment as

Rossignol u. Voorhaar,31.6

F.3d

51.6, 523

(4th Cir. 2003) (citation omitted).

Conifer's Motion for Partial SummaryJudgment
Conifer seeks parial summary judgment as to: (1) liability on its counterclâim, Q) all
claims for relief in Cone Health's Amended Complaint (except the claim fot a performânce

adjustment); (3) and other telief the Court finds appropdate. Q)ocket Entry 103.) Cone
Health argues that Conifer's motion should be denied because "there is a question of fact for

th. j"ry

as

to \¡/hether [Conifer] has cuted, could cure, or was even ttyi"g to cure its matedal

bteach at the time of termination." @1.'s Resp.

Bl at24,Docket Entry

118.)

The parties do not dispute that the any alleged bteach of the Agteement is govemed

by Notth Catolina law. To establish liability f.or a breach of contrâct claim under North
Catoltna law, there must be (1) an existing valid conttact and (2) breach of the tetms of that

contract. Poor

a.

Hill,

1,38

in dispute as to whether

a

N.C.

'{.pp.

19,26,530 S.E.2d 838, 843 (2000). Neither pany hete is

valid contract existed. Howevet, the ctux of this case surrounds the

ultimate determination of whether Conifer or Cone Health breached the ,\gteement. Undet

Notth Carchna law, when one party materially bteaches abilateral contract, the non-breaching
party is excused ftom further performance. McC/ure Lumber Co. a. Helrzsnan Constr., lnc.,1,60

N.C. App. 190, 198, 585 S.E.2d 234,239 Q003); I-øke Møry Ltd. P'shþ

u.

Johnston,145 N.C.

App. 525, 537, 551, S.E.2d 546, 555 Q001); Coleman u. Shirlen, 53 N.C. App. 573, 577J8,281,
S.E.2d 437,434 (1981). "\ü/hether abrcachis matedal or immaterial is otdinatily a question

of fact." McClare Lamber,

160 N.C. App.

at 198, 585 S.E.2d
7

^t

239 (citation omitted).

"Interpreting a conÚact requires the court to examine the language of the contract itself for
indications of the parties' intent at the moment of executio¡." State

u.

Philþ Moñ¡ USA Inc.,

363 N.C. 623, 631,-32, 685 S.E.2d 85, 90-91 (2009) (citation omitted). Thus,
language of a contract is clear, the intention of the parties is infetred

contract."

IWalton u. Ciyt ofRohiyh,342

"[i]f the plain

ftom the wotds of the

N.C. 879, 881, 467 S.F.2d 410,41'1,

(1'996).

Uabilin
As a threshold issue, the Court must

ftst detetmine the scope of this suit. Hete, Cone

Health alleges that Conifer has breached S 11.2

of the,{.gteement which

performance of services that Conifer has obligated itself
Cone Health further asserts that

it dghtfully

alleged breach should not be narrowed

to. (Jaa Master

sets forth the

Agreement S 11.2.)

tetminated under $ 15.2(a), and that Conifet's

to the six specific violations set forth in the lettets

dated May 10, 201.3 andJune 14, 201.3, as the basis

Conifers' failute to effectively manage the

of Cone Health's tetmination was for

A/R, "its fundamental responsibility under the

[Agreement]." (Pl.'s Resp. Br. at25.) Under the Agreement, Cone Health (with wtitten notice)
could terminate the Agreement for cause
(60) days, or

if

if Conifer failed to fix a material bteach within sixty

amaterial bteach was incurable. (À4aster Agteement S 15.2(a).) By lettet dated

May 10, 201.3, Cone Health informed Conifer of its intent to terminate the Agteement for its
breach of its warranties of performance set forth in $ 11.2. QvIay 10 Lettet

at2.)

Cone Health

fwther stated "[t]he specific conduct that constitutes fConifet's] bteach includes, without
limitation:" (1) Conifer's management of A/R days ttending was well below industry
standards; (2) Conifer failed to assign a dedicated denial management team; (3) Conifet has

failed to ptovide daily reconciliations; (4) Conifer failed to get approval and give prior notice

8

of write-offs; and (5) Conifer improperþ engaged in balance-billing. (Id.) In closing, Cone
Health further stated that "[t]ermination of the Agteement will be effective on July 1'2,201'3
unless [Conifet] has fully cured all bteaches to Cone Health's satisfaction befote that date."
(Id. at3.)

North Catohna law generally enforces valid notice and cute
Dishner Deuelopers, Inc. u. Brown,145

569,557 S.E.2d 528 Q001);

201,3WL

601.1.1.2,

see

clauses

in a conftact.

N.C. App. 375, 378, 549 S.E.2d 904, 906, aÍ|d' 354 N.C.

alto lordan's Con$r., Inc. u. Fore¡t Springs,

LLC,738 S.E.2d 454,

at x2 (NT.C. Ct. App. Feb. 19, 201,3) ("There is no evidence in the tecord

indicating that defendant provided plaintiff with wtitten notice of plaintiffs bteach of the
contract and the right to cure as required by the Agteement."). While the Coutt recognizes
the language of Cone Health's May 10 letter, including its "without limitation" verbiage, a fak

reading

of $ 15.2(a) would requke Cone Health to ptovide Conifer notice of all of

the

performance deficiencies that tequired curing, ot that could not be cued. Flete, Conifet could
only be held liable for what it was propedy put on notice of and failed to cure, or put on notice

of bteaches thât wete incurable. LCA Deu., [ | Ç a. ll/MS Mgnt. Grp', IJ-C,789 S.E.2d 569,
340651.9, at

*2

O{.C. Ct. App. June

default could not be

a

material bteach. until aftet [defendant] was given notice and an

201,6

WL

opportunity

to

cure-were

it

21., 201,6)

(unpublished table decision)

otherwise, the cute provision

("fl]h.

in the contract would

be

meaningless."). Thus, the scope of this civil action is limited to breaches of the Agteement

I

which Conifer was put on notice4 to cure, or bteaches which Cone Health gave written notice
that were incutable.
Having considered the evidence presented with tegardto issues raised in Cone Health's
letters, the Court concludes that there is a genuine issue

cured the violatioris set

foth in Cone

of matenal fact

as to

whethet Conifer

Health's notice lettet, or whethet there were bteaches

that could not be cuted. North Carohna Court law looks at the Restatement (Second) of
Contracts for guidance on cute issues.
709,2071. fØL

IØeauer's

Asphalt dv Maint. Co. u. Il/illians,770 S.E.2d

705150,at*4 (I{.C. Ct. App. Mar L,201,1) (unpublished table decision) (quoting

Rest. 2d S 237 cmt. B (1981));

91,8 Q013) (quoting Rest.
Restatement (Second)

¡ee al¡o Reeder u.

Carter,226

2d S 369 (1981)).

N.C. App. 270,276,740 S'8.2d

Cases

ftom other iudsdictions appþing

of Contracts $ 237 have found that p^tty in bteach does not cute
^

unless it begins to substantial petfotm its conttactual obligations.

ADC

Telecommanicaîions, 1nc.,24L

F. Supp. 2d

1,01,6, 1.019-20

on the question [of whatis means to cure] is spatse,
meâns to engage
matería| failure.");
779 N.!ø.2

in

913,

itis

See

e.!., Anacapa Tech., Inc.

a.

(D. Minn. 2002) ("!7hile case law

cleat that to cure a mateÅaI breach

subsequent conduct that substantially petfotms or peffotms without a

see

al¡o Voluo Truck¡ N. Am. u. State DeP't of Transþ.,323 Wis. 2d 294,31'4,

d 423,433 Q01,0) ('Â

reasonable interpretation of the statutory wotd 'cured' means

the breaching party is to stop the offending conduct and to substantially perfotm the contract.

A North Carolina court, tn arnlyztng a contrâct suit undet New York law, found similatly that the
scope of proper termination was detetmined by the specific issues in the notice. Ba-yer CropScience I'P
a. ChenTura Corþ., No. 12 CVS 3057, 201,2 WL 28781,74, at *5 n.44 (N.C. Supet. July 1,3, 2012)
(unpublished). It held that "the newly alleged breaches cânnot support [defendant's] termination of
the þatties'l Agreement, and the coutt will only look to the issues raised by [defendant] in the Notice
to determine whether [defendant's] termination of the þarties'] Agreement was ptoper." (Id.)

+

10

No other interpretâtion of the word 'cured' is mote teasonable )');
u. Coleman Co.,

Fleetwood FoldingTrailer¡, Inc.

38IQn. App. 2d 30, 43, 1.61P.3d 786, 198 Q007) (considering "substantial

performance" descdbed ín Anacaþa). "Cure does not require perfect performance. Anacapa,
241,

F. Srrpp. 2d at 1,020. Hete, under $ ts.Z(a)(t) of the Agreement, Cone Health could

ptopedy tetminate the contract if Conifet failed to cure to

a

level of substantial performance.

Also, Cone Health could terminate the Agreement pursuant to $15.2(a)(ü)

if it gave wdtten

notice of breaches that could not be cured.

Aftet reviewing the evidence presented, it is unclear whether Conifer substantially
petformed, thereby curing the purported breach of the watranties of petformance. Substanttal
petfotmance of the issues raised in Cone Health's cortespondence are collectively geffiâne to
this bteach of conttact action, and the determination of such perfoÍmance is a question of f.act

fot the jury. For example, one of the issues raised in the May 10 letter included Conifer's failute

to designate "a dedicated denial mânagement team to review and resolve Cone [Health's]
denials." (À4ay 10 Letter at2.) The specific coîtta'cttra,l provision refetenced is paragtaph V.8
of the Supplement, which indicates that the "fd]enial claims will be teviewed by specific teams
dedicated to the resolution of certain types of denials." (Suppl. 1 T V.8, Docket Entry 45-1, at

32.) This clause is ambþous
the denial claims, or

if

as

to whethet special denial teams wete requited to deal with

Conifets cuttent team structure met the terms of the agïeement.

Conifet argues that though it did not have to implement special teams,5 it offered, in its May
30 tesponse letter, to make the necessary adjustments to Cone Health's satisfaction. (Àzlay 30

5

Cone Health also submits evidence that Conifer's representatives acknowledged that a specific denial
management team was necessâty. (See Andtea Mendoza Dep. Ex. 7875:6-76:7, Docket E,try 121-17
at 8-9.) Conifer's objections to the use of this deposition testimony is overruled.
11

Letter

*4.)

Ina deposition, Cone Health's Vice Ptesident of Revenue Cycle, Michael Simms

admitted that he did not personally respond, and that he could not tecall, not give an answer

to whether anyone from his staff told Conifer to implement a dedicated denial staff. (Simms
Dep., Ex. 15 1.35:5-136:25, Docket Entry 105-7

^t32.)

TheJune l4Ietter by Cone Health did

further discuss the denial team mânagement issue, and concluded by "demand[ing] that
[Conifer] immediately desþate and implement a dedicated denials team that is completely
separate

ftom. . . the existing 55-member collections team." Sune 1,4Letter at 3.) Yet, in a

further response dated August 8,2073, Conifer again indicated that it was "teady, willing, and

able

to make this

change immediateþ upon receiving insttuction

to do so ftom Cone

[Health]." (August 8 Letter, Ex. 31, Docket Er,tty 105-9 ^t 22.) These facts all present
genuine issue of whethet substantial petfotmance has been

a

met. Likewise, thete are othet

disputed facts raised regarding other issues in the May 10 letter. There ate also genuine issues

of

material factas to alleged breaches that could not be cured, fot example, as Cone Health

sets

forthinitsJune 1.4,20L3letter. (SeeJune14Letter.ùt2-4.) Suchissues pteclude summalT

judgment in favor of Conifet as to liability on its countetclaim and as to Cone Health's claims

in the Âmended Complaint.

To the extent Conifer seeks parial summalT judgment
alleged breach

as

to certain gtounds fot the

of contract, the Coutt finds that this is impropet under Federal Rule of Civil

Procedure Rule 56. Rule 56 permits

claim or defense--or the p^tt

of

^p^rty

to "move fot summary judgment, identi$ring each

each claim

ot

defense--on which summary judgment is

sought." Fed. R. Civ. P. 56(a). Par:ual summa{y judgmentis permitted (..g., finding of liability,
the issues

of damages); however, this rule is impropet as to what Conifer
l2

seeks; that is, a

pruning

of

factual allegations related to Cone Health's sole bteach

of contract claim (which

raises several grounds of termination).ó Conifet opposes Cone Health's argument and relies

upon the 2010 Comment Notes of Rule 56(a), which "make[s]

cIear.

at the beginning that

summary judgment may be requested not only as to ân entire case but also as

to a claim,

defense, or part of a claim ot defense." Fed. R. Civ. P. 56(a), 2010 Comm. Notes. The Court
agrees that disposition

of

less than an entire action is petmissible under the

Rule. However,

to piecemealand separately decide each gtound for which Cone Health bdngs its claim, which
is the root of liability in this breach of contract action pursuant to one ptovision in the parties'
agreement, does not serve the best interest of justice here.7 Indeed, the case cited by Cone

Health supports this position.

Cardenas a. Kantv

Hay L.L.C, No. 14-1067-S4C,201.6 WL

3881,345, at x7 (D. I{an. July 1,8,201,6) (unpublished)

("Thete may be parts of claims, such

as

liability, upon which a motion for. parial summary judgment may be granted.").8
Damase¡

-

'Reasonable Certaintv" Standard

Conifer also asserts that Cone Health's pdncipal damages fail undet the "teasonable
cefiunty" standard. (Def.'s Br. at 22.) Cone Health argues that its damages ate teasonably

6 The Amended Complaint sets forth two counts, one fot bteach of the Agteement, and one fot
breach of the supplement. Çæ Am. Compl.\n64-72.) There is no dispute that the parties were
operating undet one single contrâct.

7 This

also applies to Conifer's argument regarding Cone Health's disclosure (ot lack thereof) of
damages. (Jea Def.'s Bt. at26-27, Docket Entry 104.)
8 Cardena¡ fiuther stated that "þabiliry] is a much latget aspect ot 'element' of plaintiff s negligence
claim than the issues raised in plaintiffs motion. Plaintiffs motion asks the court to make piecemeal
findings ofl matters which . . . does not promote a just, speedy or inexpensive determination of this
dispute." 201,6WL 3881.345, *t*7. See also Bolkin Anchor Co. u. AT dz T Corp.,825 F. Snpp. 2d706,
709 (E.D.N.C. 201t) þpptyr"g similar principle under Rule 12þ)(6) standatd) ('The court also
declines to accept defendant's invitation to dismiss the libel claim 'in part,'which âppears to the court
to be little more than ân âttempt to dispose of. at allegarion nthet than the undetlying claim.").

13

certain and not speculative.

Pl."

Resp. Br. at 29.)

A"party seeking damages must show that

the amount of damages is based upon a standard that will allow the finder

of

the amount of damages with reasonable certâinty." Oliuetti Corp.

Bat

N.C. 534, 5474$356 S.E.2d 578, 586 (1987). "In
defendant's misconduct âre shown
required to show

aî

Ames

S1ts., 1nc.,31.9

where a claím for damages ftom

to a reasonable certainty, the plaintiff should not

exact dollar amount

Head dv Engqø*t Egazþ.,

cases

u.

fact to calculate

with mathematical precision."

a

be

Sanbe/t Renta/s, Inc.

u.

L.L.C,174 N.C. App. 49, 61,, 620 S.E.2d 222,23L (2005). However,

damages may not be "based upon mere speculation or

conjectute." Byd's L¿wn

dz l-"andvøpìng

Inc.a.Smith,142N.C. App.371,379,542S.8.2d 689,694 (2001). Thebutdenisonthepatty
seeking damages to show that the teasonable cettainty standard is met. Med. StaffingNetwork,

Inc. a. Ndgway 194 N.C. App. 649, 660, 670 S.E.2d 321,, 330 (2009). "IØhethet a patty's
evidence meets the 'teâsonable certainty' standatd is a question of law fot the
IWashington

Mat. Bank, 566 F'. S.rpp. 2d 468,482 (E.D.N.C. 2008), afd

court."

sub nom. Ro¡¡ u.

Ross

u.

F.D.LC.,

625F.3d 808 (4th Cu.201,0) (citation omitted).
Hete, "[to] estimate its damages, Cone [Health] applied an histotical gross collection
rate ("GCR") to an extrapolated amount of AR that was written off due to Conifer's breach."
(Pl.'s Resp

.Bt. at29.) Thebasis for the GCR is set forth in the affidavit of David Ìüofford.

$Vofford Aff., Ex. 124,Docket Entry 1,24-1,2.) According to Wofford, the GCR is "simply
the amount actually collected during the time period in question, divided by the total amount

of all charges þoth Collectible Chatges and Uncoliectible Chatges)." (Id.nU,.) Conifer takes
issue

with this calculation because it would include "Clean Claims" which are claims Conifet

would not have worked on. Conifer worked on "Ptoblem Claims." pavid Wofford Dep.,

14

Ex. 36 303:23-306:4, Docket E.rtry 105-9 at 57-58.) Woffotd noted that "þlresumbly, the
collection :øite for the

A/R

under its management should be lower than the ovetall gross

collection rate because [Conifet] only managed 'Ptoblem Claims."' flWofford -,\ff. T 7.)
However, ìTofford also expressed the ptoblems with solely

c

tegoriziîgClean verses Problem

Claims, and also stated that the GCR "takes into account, over an extended petiod of time, all

of the various factors that lead to a physician practice not collecting

II 8, 14.) Wofford

1,00o/o

of its chatges."

Qd.

futther stated that this application was "an extremely conservative

calculation method." (Id.

11

1,6.)

Based upon the calculation method used hete, the Coutt cannot conclude as a mattet

of law that Cone Health's damages are putely speculative and not reasonably certain. The
historical collection rate used hete is distinguishable from the collection method teiected in
Managed Care Profls, Inc. u. Medlantic Healthcare Grp., 1.64

F3d 624,1998 ffl- 704458, at*7 (4th

Cir. Oct. 1, 1998) (unpublished table decision).e In that case, the plaintiff ptedicted its damages
based upon collection rates from pdor dealings

with aûother health care ptovider and

a

different third-paty payot. Id. at *6-7. The Coutt also noted that the plaintiff failed to
perform. "detailed account-by-account reviews." Id. at
calculation did

*7.

Hete, Cone Health's damages

not include anothet health care ptovider and based upon the

expert's

explanation of the method used, the application of the historical GCR should allow the fact-

finder to calculate damages with reasonable cetainty. Thus, Conifer's motion for partial
summary judgment as to Cone Health's damages fall.Io

e This case applied Virginia law.
10 The Court overrules Conifer's objections to the use of \X/offord's affidavit.
15

Cone Health's Motion for Partial SummaryJudgment
Cone Health seeks pattdral summâtT judgment as to damages on Conifet's counterclaim

for two reasons: (1) Conifer is bared from recoveting iost profits; and Q) if Conifer is entitled

to lost profìts, such damages should be limited to those occurring priot to August g,201,4.
@1.'s

for

Br., Docket Entry 101.) Conifet argues to the contrar!, asseting thatit seeks damages

direct

lost profits which âre not bared under the Agreement, and that ít is entitled to

damages acctued

thtough January

31.,201,7

.

(Def.'s Resp. Br.,

As to Cone Health's fìrst argument,

DocketBnty

1,17

.)

it relies upon a ptovision in the Agreement

regatding the disclaimer of inditect damages. Section 1,4.2 of the Agteement states:

Disclaimer of Indirect Damages. Neither paty shall be liable to the othet
patty for indirect, incidental, consequential, exemplary, punitive or special
damages, incløding lott profits, tegatdless of the form of the action ot the theory
of tecovery, even if such pafty has been advised of the possibility of such
^
damages, but such limitation shall not apply to a breach of the business associate
agreement (BAA) between the parties.
(I4astet Agreement S 14.2) (emphasis added)). Cone Health argues that this provision excludes

all damages for lost profits, whether cìirect or incìirect. €1.', Bt. at

8.) Conifer âsserts that a

plain reading of S 14.2 of the Agreement leads to only one conclusion that the lost ptofits
language set out

in the ptovision solely pertains to

irudirect

loss ptofits, thus Conifet's loss

ptofits that^reclitect damages are not barred. (Def.'s Resp. Br. at 10.)
As pteviously stated, plain and unambiguous language of a contract controls and the
intention of parties is infered from the wotds of the contracl Phihp Morris,363 N.C. at631,-

32,685 S.E.2d at 90 (citation omitted). Here, the clear language of $ 14.2 leads to only one
appropriate intelpretation that the parties are barred from recovedng only inditect lost profits,

1,6

thus Conifer's claim for damages tesulting ftom ditect lost profits are recovetable under the
Agreement.

To reach this conclusion, the Court looks at the language of $ 14.2 as a whole, and with
particuladty, the words "incladinglost ptofits." (I\4aster Agteement S 14.2) (emphasis added)).
This language is preceded by

a

list of excludable damages: "inditect, incidental, consequential,

exemplary, punitive or special damages." (Id.) Intetpreting a statutory provision, the Nonh

Caro\na Coutt

of

Appeals has telied upon general dictionary definitions

to the wotd

"including":
The New Oxþrd American Dictionarl defines the wotd "including" to mean
"containing as patt of the whole being considered." The New Oxþrd American
Dictionøry. . . . SimilaÃy, Black't Løw Dictionary explains, "The patticiple including
typically indicates a par:úalhst." B/ac/<'t I,aw Dictionary 831 (9th ed. 2009).
Sîate ex rel. Utìlities Comm'n u. Enutl.

Def Fand,214 N.C. App. 364,367,7L6 S.E.2d 370,372

Q01,1). In appþing another the statutory provision, the Supreme Coutt of
stated that "[c]leady, by use

Noth

Carohna

of the wotd 'including' the lawmakers intended metely to /i:t

examples[.]" ,òt CarolinaTpk. Auth.

u. Pine

Island,Inc.,265 N.C. 109, 120,1,43 S.E.2d 31,9,327

(1965) (emphasis added). Thus, the sole reasonable interpretation of "lost profits" in S 1,4.2

is that the tetm is an example of the pteceding list of excludable damages, all of which

are

indirect and consequential in nature such that none necessadly flow immediately from the
bteach.

See e.!., Plea¡ant

Vallgt Promenade u. I-echmere, Lruc.,1,20 N.C.

,\pp. 650,671.,464

47, 62 (1995) (citation omitted) (emphasis in original) ("Consequential

bteach

of contract

perfonnanca

are those claimed to resalt as a

ot special

secondary cznreqaence

S.E.2d

damages

of tbe defendanl's

fot
non-

They are distinguished from genetal damages, which ate based on the value of the

performance itself, not on the value of some consequence that performance may ptoduce.");
1,7

1,35,140,2935.8.2d21'9,223(1'982)(citng&odd

PiedrnontPlastict,Inc.u.MiqeCo.,58N.C.App.
u. Drug

C0.,30 N.C.

App. 564, 568,228 S.E.zd 35,38

damages are 'special damages, those which

(1,976)

("IncidentaI

and,

consequential

do not necessarily result ftom the wtong."')).

Because S 14.2 ptecludes recovery of. indirect lost profits and Conifet seeks directlost profits

from any damages incurted, Cone Health's motion for.parttal summarT judgment on this issue
fails.

Cone Health's teliance upon two
misplaced. In Troclte a. Binbo
damages ptovision

of

any

Notth

Carchna fedetal disttict court cases is

Foods Bakeries Distribation,

Inc., the defendant atgued that the

in the parties' contract ptecluded the plaintiff ftom recovedng lost ptofits

kind. No.3:1'L-CY-234-RJC-DSC,20'l,6WI-5417203,at*3 CX/.D.N.C. Sept.27,2076)

(unpublished). The plaintiff argued to the conttar|, asserting that the lost profits preclusion
was limited to

inditect and consequential damages. (d.) That court concluded that"the clear

language of the fdamages provision] leads to only one reasonable interpretation:

þ]laintiff

is

prohibited from recovering [any] Iost profits." (Id.) In holding that the contrâct bared all
damages tesulting
damages

ptovision

ftom lost profits,
as

Troche appears

to tely on two

cases, one

with a similar

the one in Troche,and one with a compatable damages ptovision. 1/. at

*3-4. Both âre unpersuasive hete. In Car

a. ll/al-Mørt Store¡ Inc., applylng

New York law, that

court held that the agreement between the patties "cleady states that 'lost profìts' cannot be

tecoveted." No. 10-CV-6176 CJS, 201,1, WL 9391,68, at *5 CX/.D.N.Y. Mar. 1,6, 201,1)
(unpublished). That court disagteed with the "þ]laintiff['s] focus[ I on the clause's tefetence
to 'consequential, incidental, inclirect'damages," and it also appears thât no consideration was
given to the dictionary definition of "including" which pteceded the list of disclaimed damages

18

(indirect, incidental, consequential, and special damages). Id. at

*

1, 5.11 In a

separate

unpublished order, this Coutt, applylng North Carohna law, held that "the plain language of.
[the damages clause

in the parties' agreement] clearly states that consequential

damages are

excluded, that incidental damages are excluded, and, that lost profits, tegardless of whether
they are chanctetízed as consequential damages 61 direct damages, ate excluded." Ordet at

3,Ada Uss Grp. a. Sara Lee Branded Apparel, No. 1:06-CV-610 (IVI.D.N.C. Dec. 28, 2007).
However, the provision at issue in Ada Uss included language whereby the patties agreed to
exclude "incidental or consequential damages andf or any claims fot lost

ptofits." Id. at2-3

(emphasis added). Such language is distinguishable ftom the present case.

Although not controlling, the facts hete âre more akin to the Tenth Citcuit Court of
Appeals' holding in Penntro Atsocs.,Inc. a. Sprint Spectrun, L.P.,499 F.3d 1151 (1Oth C1r.2007).

In

a breach

of contract action, the defendant argued that the plaintiff v/as not entitled to lost

profits based upon a provision in the patties' agreement fotbidding "the recovery of
'consequential damages,' specifiiing that they 'include, but ate not limited to, lost ptofits, lost
revenues and lost business opportunities."' Id.

at"

1.1.55-56. That court gave considetation to

the dictionary definition of "to include:

tt

Notably, four years after the decision 1n Can, the !Øestern District of New York, in applying New
York law, held that a disclaimer provision in a conúact did not include ditect lost profits sought by
the defendant. Nie/sen Co. p.S.), LLC u. Success S1ts., Inc., 1.1,2 F. Snpp. 3d 83, 103 (S.D.N.Y. 2015).
That coutt found that the ptovision at issue
exculpates the parties from liability fot "special, incidental, consequential, indirect,
punitive or exemplary damages including but not limited to ...lost ptofits." . . . The term
"lost profits" as it is used here, clearþ refers to ân example of losses that fall, urithin
the six categories of damages expressly excluded by the [agteement]. These categories,
in turn, clearþ refer to damages beyond those flowing directly from the [agreement].
Id.
19

The dictionary undetscores the point. \Webstet's defines the tetm "to include"
as meaning "to place, list, or rate as a part or component of a whole ot of a
Iarger group, class, or aggregate." IØebster's Third New Intemational Dictionary 1.1.43
Q002). The mote general term infotms the subsequently listed examples, not
the othet way around, and so lost ptofits hete refet only to those that ate "a
part or component" of the larger group or class of consequential damages.

Id. at 1156 (10th Clr. 2007). The court interpreted the contract clause to say "that no
consequential damages are recoverable, 'includ[ing]' lost profits;

it simply does not speak to

direct damages, or to lost profits recoverable undet such a theory." Id.12 The ptovisionl3 here
is similar in that it forbids recoverT of lost ptofits resulting ftom the preceding listed categories,

none of which are direct damages. Thus, Conifer's claim for lost ptofits flowing from direct
damages is not

barred.

See

Martin

u.

Binbo Foods Bakeriet Distribation,lza., No. 5:14-CV-17-BR,

201,6WL 5173249, at*2 F,.D.N.C. Sept.21,201,6) (unpublished) þolding that Pennsylvania
law had not definitively addressed a similar liability limitation issue; therefore, citing

the court held that "[i]t

Penncro,

is [ody] the recovery of lost ptofits which are considered

consequential, incidental, inclirect,

or

special damages that is ptecluded" and

ptofits); EMS, Inc. a. Cbeg Inc., No. 8:11CV113 ,

201,2

WL

541.2956, at

201,2) (unpublished) (appþing Nebraska law and holding

not all lost

*5 Q). Neb. Nov.

6,

that "the limitation of liability

provision draws a distinction between direct and inditect damages and excluding covetage

of the phrase 'but not limited to' when listing

of

examples

of

consequential, indkect, or incidental damages indicates that lost profits can be an example

of

the latter [such that] [u]se

tz The court in Pennno was appþing I(ansas law.
13 Cone Health argues, and this Coutt agrees, that the headline, "Disclaimer of Indirect Damages",
should be given no effect. (Jee Pl.'s Reply, Docket E rt y 707 at 3 n.7; see also Mastet Agreement $
16.8) (emphasis added)). Notwithstanding such, the plain language of the contract clause makes it
cleat that the damages disclaimed within are indirect damages.
20

such damages"); In re First Magnas Fin. Corp., No. ,A,DV.09-00381-JMM, 2010

WL 6452904, at

*5 (B.A.P. 9th Cir. Aug. 31, 2010) (unpublished) ({inding that "the plain language of
contract] unambþously restricts damages from lost profits

in the context of

[the

incidental,

punitive, indirect, special or coflsequential damages" but did not fotbid collection of profits
resulting from a clirect breach); Coremetrics,Inc.
2005

u.

AîomicPark.com,I-l,C,No. C-04-0222\MC,

WL 3370093, at *4 Oi.D. Cal. Dec. 7 ,2005) (unpublished) (appþing Califotnialaw and

finding that "the Limitations on Damages clause is unambiguous and contemplates a bar on
recoverT of indirect damages, not the direct damages fthe plaintiff] seeks hete").

Having found that Conifer is not baned from seeking lost ptofits from direct damages
resulting from any alleged breach by Cone Health, the Coutt v¡ill address Cone Health's
ârgument that Conifer should be limited to damages incured prior to August 9,201.4. €1.'.

Bt. at 10-15.) Cone Health relies upon $ 15.2(c) of the Agteement to support its argument.
The conüact ptovision states:

Without Cause. After the three (3) year anniversary of this Agreement, [Cone
any time with six (6)
Health] may terminate this Agreement without cause

^t

months written notice.
(N4aster

Agreement $ 15.2(c).) Cone Health asserts that Conifer had no expectation that the

Agreement would continue beyond the thtee year antiversary date of August 9, 2014.

Gl."

Br. at 10.) Conifer ârgues to the contrarf, and asserts that Cone Health is misguided upon the
case law

It

which it relies. (Def.'s Resp. Br. at 17-18.)
has long been established as a general rule undet

Noth

Carohna law that "[i]n a suit

for damages arising out of abteach of contract, the party injuted by the bteach is entitled to
full compensation for the loss and to be placed

21,

as near as may be

in the position which [the

non-breaching party] would have occupied had the conttact not been bteached." Meares

u.

Nixon Con¡t. C0.,7 N.C. App. 61,4,622-23,173 S.E.2d 593,599 (1970) (citing Harris dv Hanis
Constr. Co. a. Crain and Denbo, lnc.,256

N.C. 110, 1,23 S.E.2d 590 (1,962)). Thus, "the injured

patty is to be compensated 'for the loss which fulfillment of the contract could have ptevented

or the breach of it has entailed."'
1,8,

Coble u. Nchard¡on Corp. of Greensboro,

Tl N.C. App. 511, 517-

322 S.E.2d 817, 822 (1984) (citing Nonaood u. Carter, 242 N.C. 1.52, 1'55, 87 S.E.2d 2, 4

(1955). "The interest being protected by this genetal de is the non-bteaching

patty's

'expectation interes!' and in so doing, the injwed party receives the 'benefit of the bargain."'

Fir¡t

(Jnion

llat Bank of N. Carolina u. Na1/0r,102 N.C. App. 719, 725, 404 S.E.2d 1,61', 1'64

(1991) (citation omitted). Applyt"g North Carolina law, the Foutth Ckcuit in an unpublished

decision held that "when

^

contract doet provide a rþht to cancel with notice the parties must

reasonably expect that this dght might be exetcised[.]" Strategic Oahourcing Inc. u. Cont'l Cas.
Co., 27 4 F.

App'x 228, 235 (4th Cir 2008) (unpublished).

To support its atgument to limit Conifer's

damages, Cone Health relies upon its

unilateral ability to terminate the contract without câuse at the thtee-year annivetsary of the
parties'A.greement (with six months' notice). Cone Health argues that Conifet's expectation
interest could not have exceeded the scope of the without cause provision. (Pl.'s Br. at

1,2-

13.) The Court frst notes that Cone Health terminated the contract pursuant to $ 1,5.2(a)
"u/ith cause" rather than "without cause" ur S 1,5.2(c) permits. Additionally, Cone Health
tetminated the Agreement on August 12,201.3, priot to the three-y ear antiversary.

time, even

if it

At that

had sought to do so, Cone Health could not have unilaterally terminated

pursuant to $ 15.2(c) because its actions would be have been premature. Howevet, this is not

22

determinative here. North Carolina case law has held that "the damages recoverable ate such
as may

reasonably be supposed to have been in the contemplation of the paties when the contract

uat nade." Troitino a. Goodrzan, 225 N.C. 406, 41,2,35 S.E.2d 217 ,281, (1,945) (emphasis added)

(citation omitted);

see

al¡o lWelerhaeuserCo. u. GodwinBldg. Suppþ C0.,292 N.C. 557, 560-61.,234

S.E.2d 605,607 (1g77)(quoting Troitino). Thus, at the time of conttacting, Conifer could have
no expectation beyond the three year annivetsary (with six months' notice). As such, Conifet's
damages should be

limited to those occurring priot to August 9,201.4.14

274F.App'*

("Notth Carohnalaw. .. holds thataninjuted

^t235

parLy

Strategic Outsourcing

to àcontta'ctof fixed

duration mây recover damages incured during the entire contract pedod when one party
prematufely terminates the conffact if

it

does notinclude a cancellaton ptovision.").

In an alternative argument, Conifer assetts that even if the damages ate limited, such
limitation should be to February 8, 201.5 nther than the August 9,

20'1,4 anniversary date.

Q)ef.'s Br. at 23-25.) Conifer relies upon the language of $ 15.2(c) and suggests that

it "only

became operative'fo|fttrthe three Q)year anniversary.. . with six months written notice."'

(d. at24.) Cone Health argues that this new theory asserted by Conifer is imptoper and that
Conifer has "maintained the position throughout this litigation that Cone þIealth] could have
terminated the Agreement 'without cause on August 9,201.4."' (Pl.'s Reply Br. at 9, Docket

Enry

135) (citation omitted)

la Conifer âttempts to distinguish Cone Health's suppoting

cases by arguing that those cases dealt
with contract provisions allowing termination at ãnl Time and also arguing th¿t Cone Health could not
have terminated the Agreement withoat carln at the time it imptopetly breached the Agteement
pwsuant to the with cau¡e provision. @ef.'s Bt. at 1,7 -23) The Court finds these ârguments inapposite
as they fatl,to âccount for Conifer's expectation interest at the time the contract was made.
23

Here, the Coutt finds that $ 15.2(c) is ambiguous on the issue of when Cone Health

could provide notice of its intent to terminate under $15.2(c). "[A] conttact lterm]

ambþous when the 'writing
Kay dzAssoæ., P.A.

leaves

it uncettain

as

is

to what the agreement u/as . . . ."' Balrett

u. ColonialBldg. Co. ofRøleìgh,129

N.C. App. 525,528, 500 S'8.2d 108, 111

(1998) (citing Intemational Paper Co. u. Corporex Con$ructors, Inc.,96 N.C. App. 372,31,7,385
S.E.2d 553,556 (1989). The New Oxford Arnerican Dictionary defines "notice" as "notification

or warning of something, esp. to allow prepanttons to be made." The l{ew Oxþrd American
Dictionaryt1,200 @hzabethJ. Jewell et al. eds., 3d ed. 2010). Hete, the clause is susceptible to

moÍe than one interpretation âs a reasonable jury could find that Cone Health could give
notice six (6) months prior to the annivetsary date, or that Cone Health could give notice only
after the date of the three-year anniversary. The inquiry does not end hete, howevet.
Even where a court, however, detetmines as a mattet of law that the contract is
ambiguous, it may yet examine evidence extrinsic to the contract that is included
in the summary judgment matedals, and, f îhe eaidence is, as a natter of law,
ditpotitìue of the interpretatiue issae, grant vntmarytjadgmenî on that basis. If, however,
resort to extrinsic evidence in the summary judgment materials leaves genuine
issues of fact respecting the contract's proper interpretation, suûìtnary judgment
must of course be tefused and intetptetation left to the ttiet of fact.
lØasltington Metro.

Area Tranit Aath.

u. Potonac Inu. Properties, Inc.,

476 F.3d 231,,235 (4th Cu.

2007) (emphasis added) (citing Goodrzan u. Resolation Tra$ Corp.,7 F.3d 1.1.23,1,1,26 (4th Ctt.
1993)). Hete, Conifer's conduct demonstrates that the intent of the parties was that the eatliest
Cone Health could terminate the conttact (without cause) was on August 9,201,4. One

of

Conifer's executives indicated that Cone Health court tetminate after thtee years. fohn
O'Donnell Dep., Ex. B L45:1.-3, Docket Errtty
Docket Entry

1,01,-71,

1,01,-2

at 5;

see also

Worachek Email, Ex. I(,

(summarizing the contrâct term as "5 years with the option to terminate

24

after 3")). ,{.dditionally, in its discovery response, Conifet indicated that Cone health had the

opportunity to terminate the Âgreement "without cause on August 9,2074, provided that
Cone [Health] gave six months'written notice to [Conifer]." (Conifer Irlterrogâtory Response

fl 28, Ex. H, Docket Ent y

1,01,-8

at

3.) One of Conifet's experts also based a portion of his

opinion using the August 9, 2014 termination date. @,rik C. Lioy Expert Repott, Ex. G,
Docket Entry 1,07-7 at 3.) Thus, the undisputed extdnsic evidence supports the finding that
that Conifer is entided to lost profits,

if

any,

through August 9,20'1.4.1s Cone Health's motion

for patttal summary judgment is granted on this issue.

III. CONCLUSION
For the reâsons stated above,IT IS THEREFORE ORDERED that Cone Health's

Motion

forParrdral SummaryJudgment @ocket

DENIED IN PART,
103) is

Entty 100) is GRÄNTED

and Conifer's Motion for Part:raL Summary Judgment (Docket

Ettty

DENIED.
oe L.

U

April

IN PART AND

tet

States Magisttate Judge

11,201,7

Durham, North Carchna

ls Cone Health also claims that Conifer's representative drafted the A.gteement; thus, the contract is
stdctly construed against Conifer. Rqtfeld Auiation, I-LC u. þon Auiation,.Izr., No. 1:11'CY274,2074
WL 1,3201,1,8, at *9 n.15 @a.D.N.C. Mar. 31,,2074), afd Q\ov. 6,2014) ('Both,parties note the wellestablished interpretive cânon that a contract is to be construed strictly against its dtafter.").

25