ERIE OPERATING, LLC et al v. FOSTER
Filing
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MEMORANDUM OPINION AND ORDER granting 48 Motion for Summary Judgment; and adopting 57 Report and Recommendations as the opinion of the Court, as explained therein.. Signed by Judge Terrence F. McVerry on 7/20/16. (mh)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
ERIE OPERATING, LLC d/b/a
GOLDEN LIVING CENTER-WALNUT
CREEK, ERIE ACQUISITION, LLC;
GOLDEN GATE NATIONAL SENIOR
CARE, LLC; GGNSC EQUITY
HOLDINGS, LLC; GGNSC CLINICAL
SERVICES, LLC;
GGNSC ADMINISTRATIVE SERVICES,
LLC; SPECTRA HEALTHCARE
ALLIANCE, INC.; SPECTRA
HEALTCARE ALLIANCE VI, LLC; and
BEVERLY ENTERPRISES, INC.,
Plaintiffs,
v.
TOM FOSTER, Administrator of the
Estate of Kenneth W. Foster, Deceased,
Defendant.
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C.A. No. 14-72 Erie
MEMORANDUM OPINION AND ORDER OF COURT
On June 1, 2016, Magistrate Judge Susan Paradise Baxter issued a Report and
Recommendation (“R&R”) (ECF No. 57), which recommended that DEFENDANT’S MOTION
FOR SUMMARY JUDGMENT (ECF No. 48) filed by Defendant Tom Foster, Administrator of
the Estate of Kenneth W. Foster (“Foster”) be GRANTED and that judgment be entered in favor
of Defendant and against Plaintiffs. Now pending before the Court is the OBJECTION TO
REPORT AND RECOMMENDATION (ECF No. 58) filed by Plaintiffs (collectively, “Erie
Operating”).
Defendant filed a response in opposition to the Objection.
Accordingly, the
Objection is ripe for disposition.
This action was referred to United States Magistrate Judge Susan Paradise Baxter for a
report and recommendation (“R&R”) in accordance with the Magistrates Act, 28 U.S.C. '
636(b)(1), and Local Rules 72.1.3 and 72.1.4.
The procedural history is tortuous and has been
set forth in the R & R and in prior opinions of this Court. Thus, it need not be recited in full
herein.
In essence, the parties dispute whether Wrongful Death and/or Survival claims are
within the scope of an ADR Agreement executed between a resident and a skilled nursing
facility.
The narrow issue in this Federal Arbitration Act case is strictly procedural – in what
forum should the underlying substantive claims be resolved?
Erie Operating contends that both
the Survival and Wrongful Death claims should be resolved in arbitration.
Foster contends that
both the Survival and Wrongful Death claims should proceed in the Erie County Court of
Common Pleas. On August 13, 2015 Magistrate Judge Baxter concluded that the claims should
be severed, such that the Wrongful Death claim would go forward in Erie County and the
Survival claim (if valid and enforceable) would be arbitrated.
The Court adopted the August 13
R & R in a Memorandum Opinion and Order dated October 8, 2015.
Subsequently, Foster moved for summary judgment on the basis of res judicata/ collateral
estoppel/ issue preclusion.
Foster contends that this federal lawsuit is precluded by the decision
of the Honorable John Garhart of the Erie County Court of Common Pleas.
Judge Garhart held,
in a written opinion dated September 10, 2015, that Foster could not be compelled to arbitrate the
Wrongful Death claim; that the Wrongful Death and Survival claims must be consolidated in a
single action; and therefore, that both the Wrongful Death and Survival claims must proceed in
the Erie County Court.
On June 1, 2016, Magistrate Judge Baxter issued a 12-page R & R, in which she
thoroughly analyzed the applicable principles of issue preclusion under Pennsylvania law.
Magistrate Judge Baxter concluded that the issue in this case was identical to the issue decided
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by Judge Garhart; that Judge Garhart’s decision was a final judgment on the merits; that Erie
Operating was a party in that case; and that Erie Operating had been given a full and fair
opportunity to litigate the issue.
In sum, Magistrate Judge Baxter now recommends that
summary judgment be granted in favor of Defendant Foster.
Magistrate Judge Baxter’s preclusion analysis is consistent with several recent opinions
in this district which addressed similar efforts to enforce nearly identical nursing home
arbitration agreements.
See, e.g., GGNSC Uniontown, LP v. Bauer, No. CV 15-231, 2015 WL
9304508, at *2 (W.D. Pa. Dec. 22, 2015) (Bissoon, J.) (dismissing entire Complaint on issue
preclusion grounds based on state court ruling, rather than severing Wrongful Death and Survival
claims); and GGNSC Erie Western Reserve, LP v. Stubits, CA #15-61 (W.D. Pa. Aug. 7, 2015)
(Rothstein, J.) (same).
In GGNSC Altoona Hillview LP v. Martz, 2016 WL 502089, at *4
(W.D. Pa. Feb. 8, 2016), Judge Gibson noted a split among courts “as to whether a survival
claim can be compelled to arbitration in a case where, as in the case at hand, there is a related
wrongful death claim that cannot be compelled to arbitration.” Id. (citing the October 8, 2015
Memorandum Opinion in this case in the minority).
Judge Gibson concluded that issue
preclusion principles required the dismissal of the nursing home’s entire federal complaint.
This member of the Court is persuaded by these decisions and by the analysis of Magistrate
Judge Baxter. Accordingly, it will adopt her June 1, 2016 R&R as the opinion of the Court.
An appropriate Order follows.
McVerry, S.J.
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IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
ERIE OPERATING, LLC d/b/a
GOLDEN LIVING CENTER-WALNUT
CREEK, ERIE ACQUISITION, LLC;
GOLDEN GATE NATIONAL SENIOR
CARE, LLC; GGNSC EQUITY
HOLDINGS, LLC; GGNSC CLINICAL
SERVICES, LLC;
GGNSC ADMINISTRATIVE SERVICES,
LLC; SPECTRA HEALTHCARE
ALLIANCE, INC.; SPECTRA
HEALTCARE ALLIANCE VI, LLC; and
BEVERLY ENTERPRISES, INC.,
Plaintiffs,
v.
TOM FOSTER, Administrator of the
Estate of Kenneth W. Foster, Deceased,
Defendant.
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C.A. No. 14-72 Erie
ORDER OF COURT
AND NOW, this 20th day of July, 2016, IT IS HEREBY ORDERED, ADJUDGED
and DECREED that the R&R of June 1, 2016 is ADOPTED as the Opinion of the Court;
Plaintiffs’ OBJECTION TO REPORT AND RECOMMENDATION (ECF No. 58) is DENIED;
and DEFENDANT’S MOTION FOR SUMMARY JUDGMENT (ECF No. 48) is GRANTED.
Judgment will be entered in favor of Defendant and against Plaintiffs. The clerk shall docket this
case closed.
s/ Terrence F. McVerry
TERRENCE F. McVERRY
Senior United States District Judge
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cc:
U.S. Magistrate Judge Susan Paradise Baxter
William M. Buchanan, Esq.
Email: wmbuchanan@burnswhite.com
Patrick L. Mechas, Esq.
Email: plmechas@burnswhite.com
Michael T. Collis, Esq.
Email: mcollis@wilkesmchugh.com
Ryan J. Duty, Esq.
Email: rduty@wilkesmchugh.com
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