Katz v. Univ. Hosp. Health Sys., Inc.Katz v. Univ. Hosp. Health Sys., Inc.
JUDGMENT: REVERSED AND REMANDED
RELEASED AND JOURNALIZED: September 22, 2022
Appearances:
Caryn Groedel & Associates, Co., LPA, and Caryn M. Groedel, for appellant.
Vorys, Sater, Seymour and Pease, LLP, Anthony J. O‘Malley, Charles F. Billington, III, and Karey E. Werner, for appellees.
{¶ 1} Plaintiff-appellant, Jessica Katz, D.O. (“Katz“), appeals the trial court‘s decision dismissing her complaint pursuant to
I. Procedural History and Factual Background
{¶ 2} Before addressing the merits of the case and setting forth the relevant factual background, this court takes notice that the trial court entered a protection order in this case that allowed the parties to submit pleadings and motions under seal. Those filings are unredacted dоcuments. The parties then filed corresponding redacted documents that are publicly available. Regarding the appeal, Katz requested this court to permit the parties to submit and file their appellate briefs in the same manner as they did with the trial court. This court granted the motion. In keeping with the integrity of this court‘s оrder, we will attempt to limit our discussion to only the information contained in the publicly available, redacted appellate briefs and trial court filings.1
{¶ 3} In April 2021, Katz filed a civil action against defendants-appellees, University Hospitals Health System, Inc. (“UH“), Daniel Simon, M.D., Cliff Megerian, M.D., Sandhia Varyani, M.D., Nancy Cossler, M.D., James Liu, M.D., Marc Snelsоn, M.D., and Robyn Strosaker, M.D. (collectively “appellees“).
{¶ 5} This lawsuit relatеs to actions taken by appellees during Katz‘s employment with UH as a physician practicing in the specialty of obstetrics and gynecology and to the events that unfolded during the negotiation of an employment separation agreement between Katz and UH.
{¶ 6} Katz alleged that during these negotiations, her counsеl consistently maintained that any separation agreement between the parties would have to include (1) specific agreed-upon language regarding Katz‘s resignation, (2) certain agreed-upon language for UH‘s report to the National Practitioner‘s Data Bank (“NPDB“), and (3) the retention of particular rights. Accоrding to the second amended complaint, Katz alleged that counsel for UH made undisclosed material modifications to the agreement prior to Katz‘s execution and that UH‘s counsel
{¶ 7} On October 12, 2021, appellees moved to dismiss Katz‘s second amended сomplaint pursuant to
{¶ 8} Katz opposed the motion, contending that she had set forth viable claims for relief to prevent dismissal under
{¶ 9} Appellees filed a reply initially contending that the exhibits Katz attached to her response were not appropriate because under a
{¶ 10} The trial court did not convert appellees’
[Appellees‘] substituted motion to dismiss the second amended complaint, filed 10/12/2021, is granted. The court finds the parties executed a valid and enforceable separation agreement. Furthermore, the court finds Brisco v. U.S. Restoration & Remodeling, Inc., 10th Dist. Franklin No. 18 AP-109, 2019-Ohio-5318, quoting Ed Schory & Sons, Inc. v. Francis, 75 Ohio St.3d 433, 662 N.E.2d 1074 (1996) persuasive:
A person of ordinary mind cannot say that he was misled into signing a paper which was different from what he intended to sign when he could have known the truth by merely looking when he signed. * * * If this were permitted, contracts would not be worth the paper on which they are written. If a person can read and is not prevented from reading what he signs, he alone is responsible for his omission to read what he signs.
II. The Appeal
{¶ 11} Katz now appeals, raising the following five assignmеnts of error:
- The trial court erred in relying on case law dealing with motions for summary judgment rather than motions to dismiss.
- Katz asserted viable claims that should not have been dismissed on a [Civ.R.] 12(B)(6) motion.
- The trial court erred in dismissing Katz‘s second amended complaint on a [Civ.R.] 12(B)(6) motion without considering all facts and claims.
The trial court erred in dismissing Katz‘s seсond amended complaint on a [Civ.R.] 12(B)(6) motion without considering Katz‘s claim that she signed the separation agreement under duress. - When ruling on UH‘s motion to dismiss, the trial court erred by drawing inferences in favor of UH, the moving party, rather than Katz, the non-moving party.
III. Standard of Review – Civ.R. 12(B)(6)
{¶ 12} When reviewing the sufficiency of a complaint, this court is mindful that
We review rulings on
Civ.R. 12(B)(6) motions to dismiss under a de novo standard. “A motion to dismiss for failure to state a claim upon which relief can be granted is procedural and tests the sufficiency of the complaint. * * * Under a de novo analysis, we must accept all factual allegations of the complaint as true and all reasonable inferences must be drawn in favor of the nonmoving party.” NorthPoint Props. v. Petticord, 179 Ohio App.3d 342, 2008-Ohio-5996, 901 N.E.2d 869, ¶ 11 (8th Dist.). “For a trial court to grant a motion to dismiss for failure to state a claim upon which relief can be granted, it must appear ‘beyond doubt from the complaint that the plaintiff can prove no set of facts entitling her to relief.‘” Graham v. Lakewood, 2018-Ohio-1850, 113 N.E.3d 44, ¶ 47 (8th Dist.) quoting Grey v. Walgreen Co., 197 Ohio App.3d 418, 2011-Ohio-6167, 967 N.E.2d 1249, ¶ 3 (8th Dist.).
Id. at ¶ 28, quoting Hersh v. Grumer, 2021-Ohio-2582, 176 N.E.3d 1135, ¶ 5 (8th Dist.). “[A] court‘s factual review is confined to thе four corners of the complaint.” Dabney v. Metro Appraisal Group, Inc., 8th Dist. Cuyahoga No. 106917, 2018-Ohio-4601, ¶ 15. However, items properly incorporated within the complaint may
{¶ 13} Therefore, “[a]s long as there is a set of facts, consistent with the plaintiff‘s complaint, which would allow the plaintiff to recover, the court may not grant a defendant‘s motion to dismiss.” Woods at ¶ 29, quoting York v. Ohio State Hwy. Patrol, 60 Ohio St.3d 143, 145, 573 N.E.2d 1063 (1991). Additionally, a court may not dismiss a complaint under
IV. Analysis
{¶ 14} The separation agreement executed by the parties is governed by traditional contract principles. In Kostelnik v. Helper, 96 Ohio St.3d 1, 2002-Ohio-2985, 770 N.E.2d 58, thе Ohio Supreme Court described the requirements for formation of a contract:
“A contract is generally defined as a promise, or a set of promises, actionable upon breach. Essential elements of a contract include an
offer, acceptance, contractual capacity, сonsideration (the bargained for legal benefit and/or detriment), a manifestation of mutual assent and legality of object and of consideration.”
Id. at ¶ 16, quoting Perlmuter Printing Co. v. Strome, Inc., 436 F.Supp. 409, 414 (N.D.Ohio 1976); Rayess v. Educational Comm. for Foreign Med. Graduates, 134 Ohio St.3d 509, 2012-Ohio-5676, 983 N.E.2d 1267, ¶ 19 (quoting Kostelnik). “A meeting of the minds as to the essential terms of the contract is a requirеment to enforcing the contract.” Id., citing Episcopal Retirement Homes, Inc. v. Ohio Dept. of Indus. Relations, 61 Ohio St.3d 366, 369, 575 N.E.2d 134 (1991). And “[a] settlement agreement can only be rescinded upon claims such as fraud, duress, or undue influence.” In re J.E. P.-T., 8th Dist. Cuyahoga Nos. 104473 and 105098, 2017-Ohio-536, ¶ 18, citing Hildebrand v. Hildebrand, 8th Dist. Cuyahoga No. 96436, 2011-Ohio-5845, ¶ 14, citing Mack v. Polson Rubber Co., 14 Ohio St.3d 34, 36, 470 N.E.2d 902 (1984).
{¶ 15} In this case, Katz has alleged both fraudulent inducement and duress. After thoroughly reviewing the necessary components of both fraudulent inducement and duress in conjunction with the accepted-as-true allegations set forth in Katz‘s complaint, we find that the allegations set forth in the complaint arguably establish a lack of a meeting of minds as to the essentiаl terms of the separation agreement, to wit: whether Katz waived certain rights under the separation agreement and whether the NPBD report included information beyond that which was agreed upon by the parties.
{¶ 17} UH maintains that the separation agreement is valid and enforceable and was not procured or induced by fraud or duress because (1) no undisclosed material changes were made prior to Katz executing the agreement, (2) Katz and her counsel had a duty to read and review the agreement prior to execution, and (3) any omissions by UH or its attorneys are not actionable. In support, UH relies on the allegations in Katz‘s complaint referencing emails, tеxt messages, phone conversations, and drafts of the agreement exchanged between respective counsel during negotiations of the separation agreement.
{¶ 18} As recognized by appellees in their motion to dismiss, “the majority of claims in this case depend on one issue: did [UH] commit fraud by failing to highlight a change in a draft of the separation agreement?” We agree with this
{¶ 19} This case hinges on when the modification that Katz alleges was material to the separation agreement occurred and when counsel had notice of such modification. Is this a situation where a modification occurred at the last minute, or was the modification made in prior versions and counsel failed to rеcognize the material change? Evidence outside of the four corners of the complaint must be considered to resolve this issue.
{¶ 20} As for the NPDB report that was submitted and the code used, discovery will reveal whether the negotiation between the parties was merely based on the narrative language that would be inсluded in the report or was the disclosure of the code the crucial component necessary for Katz to execute the separation agreement. Additionally, whether UH‘s usage of that particular code violated any provision of the separation agreement goes beyond the four corners of the complaint. Finally, whether another code should have been used based on any alleged agreement is a matter outside of this record.4
{¶ 21} We find that this case ultimately centers on discovery that is beyond a
{¶ 22} Whether Katz will ultimately prevail on her claims is not for this court or the trial сourt to consider at this stage of the proceedings. When reviewing the allegations in the complaint in favor of Katz, we find that Katz‘s complaint asserts a set of facts that would entitle her to relief. Accordingly, we find merit to Katz‘s third and fifth assignments of error and reverse the trial court‘s decision. Katz‘s other assignments of error also seeking reversal are hereby rendered moot.
{¶ 23} Judgment reversed and remanded for further proceedings.
It is ordered that appellant recover from appellees costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate be sеnt to said court to carry this judgment into execution.
KATHLEEN ANN KEOUGH, JUDGE
SEAN C. GALLAGHER, A.J., and MICHELLE J. SHEEHAN, J., CONCUR