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09-6023
1 0 1 PETER J. SAKOL, M.D., LLC, Plaintiff V. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Defendant IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA NO: PRAECIPE FOR WRIT OF SUMMONS TO THE PROTHONOTARY: Kindly issue a Writ of Summons against Defendant, Farrell Plastic Surgery and Laser Center, P.C. The Writ of Summons should be delivered to undersigned counsel for service. Respectfully submitted, Date: Septembers, 2009 CUNNINGHAI & CHERNICOFF, P.C. ce J. Warshawsky, Esquire PA Attorney Identification No. 58799 2320 North Second Street Harrisburg, PA 17110 (717) 238-6570 Attorneys for Plaintiff tLr? ? rr ?? ?h? L ?.un1J 11 . 20i9 r f 7 ?-, 50 p d_ ,,W,( t tlj ?4S-?L y 2 I5L r PETER J. SAKOL, M.D., LLC, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA V. NO: 46 -23 FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Defendant WRIT OF SUMMONS TO: Farrell Plastic Surgery and Laser Center, P.C. c/o Heather D. Royer, Esquire Smigel, Anderson & Sacks LLP 4431 North Front Street Harrisburg, PA 17110 You are notified that the Plaintiff has commenced an action against you. /,5-/ d ";A) A CC" Prothonotary y? ? G' Dated: S 3 GOI? V 9 3 G Pt, al0 jL? ?=3 ?bSw??G J-6`f PETER J. SAKOL, M.D., LLC, Plaintiff V. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Defendant IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA NO: 09-6023 ACCEPTANCE OF SERVICE I, Heather D. Royer, Esquire, accept service of the Writ of Summons in the above- captioned action on behalf of Farrell Plastic Surgery and Laser Center, P.C. and certify that I am authorized to do so in accordance with Pa. R.C.P. 402. Date: SMIGEL ANDERSON & SACKS LLP By: Heather D. Royer, gi?WW Smigel, Anderson & Sacks LLP 4431 North Front Street Harrisburg, PA 17110 F.W=mM W0M\SAKOL.PEM\Ge wW Bushwo M of Swww n.%Td OFMMW%M SEP 31 PN b 30 PETER J. SAKOL, M.D., LLC, Plaintiff V. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Defendant IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA NO: 09-6023 PRAECIPE TO ENTER APPEARANCE Please kindly enter the appearance of Charles I. Artz, Esq. and Artz Health Law on behalf of PETER J. SAKOL, M.D., LLC, the Plaintiff in the above captioned action. Respectfully submitted, ARTZ HEALTH LAW By: Charles I. A Esq. I.D. # 55747 200 North Third Street, Suite 12-B Harrisburg, PA 17101 (717) 238-9905 Counsel for Plaintiff Peter J. Sakol, M.D., LLC Dated: October 26, 2009 -G?, CERTIFICATE OF SERVICE I, Charles I. Artz, Esq. do hereby certify that a true and correct copy of the Praecipe to Enter Appearance in the above-captioned matter was sent via First Class U.S. Mail, postage prepaid on this date, to the following: Heather D. Royer, Esq. Peter Good, Esq. Lee Smigel, Esq. Smigel, Anderson & Sacks, LLP 4431 North Front Street Harrisburg, PA 17110 Charles I Artz Esq. Dated: October 26, 2009 Tow {7F Nf-eta %t FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Respondent/Plaintiff, v. a9 - Cvoa3 Civit IerM. copies I~istrilbuted ]per ~;~ Initials ~t,J IN THE COURT OF COMMON PLEAS, DAUPHIN COUNTY, PENNSYLVANIA NO. 2009-CV-15556-CV N PETER J. SAKOL, M.D., LLC, ~ p Movant/Defendant, :CIVIL ACTION -LAW ~ ~ JURY TRIAL DEMANDED -v~. ~ ~ ~~ ~ ~ r. ~'' ~ ~ ORDER OF COORDINATION o AND NOW, this 6`h day of May, 2010, upon consideration of the Motion For `~ m Coordination of Actions in Different Counties Pursuant to Pa.R.Civ.P. § 213.1, the Answer thereto, oral arguments and briefs, it is HEREBY ORDERED: 1. This Action shall be transferred to the Court of Common Pleas of Cumberland County, docketed to 09-6023. The caption shall read as follows: PETER J. SAKOL, M.D., LLC, : IN THE COURT OF COMMON PLEAS, Plaintiff/Counterclaim Defendant, :CUMBERLAND COUNTY, PENNSYLVANIA v. : NO. 09-6023 FARRELL PLASTIC SURGERY AND ~ o LASER CENTER, P.C., z~r,U~ -~ Defendant/Counterclaim Plaintiff, ~! ~; ~ `~ ~r cn.s> c..a ~~ 2. Peter J. Sakol, M.D., LLC shall pay the Court costs, if any, of such cook ~atio N -c3 c~ a ~:, --~-Y-i r,-, ~ ~'- c-~ onrn ~~< ~~ `~ .~ r~, ~~ ~_~ ~.:~ ~. ~- r 3. The matter before this Court and docketed to this term and number shall be dismissed with the designation "coordinated to action pending in Cumberland County, Pennsylvania, consistent with the terms of this Order of Coordination"; 4. The Prothonotary is hereby directed to certify a copy of this Order of Coordination and to transmit it to the Court of Common Pleas of Cumberland County to take such action as may be appropriate to carry out this Order; 5. Peter J. Sakol, M.D., LLC shall be designated as the Plaintiff and Counterclaim Defendant in the coordinated action and Farrell Plastic Surgery and Laser Center, P.C. shall be designated as the Defendant and Counterclaim Plaintiff in the coordinated action. 6. To the extent that the pleadings in the coordinated action by and between the parties have not yet been closed, the parties are directed to file responses to the last pleadings which require a responsive pleading within twenty (20) days of the date of this Order. MAY ~ ~ ~~~~ BY THE COURT: Deborah Essis Curcillo, J. Distribution: The Hon. Deborah Essis Curcillo Bruce J. Warshawsky, Esq., Cunningham & Chernicoff, P.C., 2320 North Second St. Harrisburg, PA 17110 Peter M. Good, Esq., Darryl J. Liguori, Esq., Smigel, Anderson & Sacks, LLP, River Chase Office Center, 4431 North Front St., Third Floor, Harrisburg, PA 17110 Charles Artz, Esq., 200 North Third St., Ste 12B, Harrisburg, PA 17101 Cumberland County Court of Common Pleas Stephen E. Farina Prothonotary OFFICE OF .~.RpTHONOTARY Curtis R Long, Prothonotary May 11, 2010 Cumberland County Court House Hanover & High Streets Carlisle, Pa 17013 Front & Market Streets Harrisburg, PA 17101 (717)780-6520 IN RE: Farrell Plastic Surgery & Laser Center P.C. Vs Peter J Sakol, M.D. LLC Dauphin County Dkt No 2009 CV 15556 CV Cumberland County Dkt No. Dear Sir/ Madam: By Order of May 6, 2010 by Deborah E Curillo, Judge The above matter has been transferred to the Court of Common. Pleas of Cumberland County. I am, accordingly, sending originals of all the papers herewith. I Will appreciate the return of the attached receipt address to the Attention: of Ms. Lisandra Garcia. Very truly yours, Stephen E. Farina Prothonotary County of Dauphin Date: 5/11 /2010 Time: X3:01 PM Page 1 of 3 Filed: 11 /18/2009 Subtype: Civil Comment: Status History Pending Transferred Closed Judge History Dauphin County Complete Case History Case: 2009-CV-15556-CV Farrell Plastic Surgery vs. Peter J Sakol Physical File: Y 11 /18/2009 5/11 /2010 5/11 /2010 Appealed: N User: LGARCIA Date Judge Reason for Removal 11/18/2009 No Judge, Administrative 3/8/2010 Curcillo, Deborah Essis Current Payments Receipt Date Type Smigel Anderson & Sacks 208968 11/18/2009 Civil Filing Plaintiff Name: Farrell Plastic Surgery Address: Phone: Home: Work: Employer: Litigant Type: Comment: Attorneys Good, Peter M (Primary attorney) Defendant Name: Sakol, Peter J Address: Phone: Home: Work: Employer: Litigant Type: Comment: Attorneys Artz, Charles I Warshawsky, Bruce J (Primary attorney) Register of Actions 11 /18/2009 Plaintiff: Farrell Plastic Surgery Attorney of Record: Peter M Good New Civil Case Filed This Date. Amount 132.00 Total 132.00 SSN: DOB: Sex: Send notices: Y Send Notices SSN: DOB: Sex: Send notices: Y Send Notices Send Notices No Judge, No Judge, Date: 5/11/2010 Dauphin County Time: 03:01 PM Complete Case History Page 2 of 3 Case: 2009-CV-15556-CV Farrell Plastic Surgery vs. Peter J Sakol Register of Actions 11/18/2009 Filing: Complaint Paid by: Smigel No Judge, Anderson 8~ Sacks Receipt number: 0208968 Dated: 11/18/2009 Amount: $132.00 (Check) For: Farrell Plastic Surgery (plaintiff) Complaint filed. No Judge, AOPC CIVIL STATISTICAL REPORT Curcillo, Deborah Essis (AGING PURPOSES) 1/27/2010 Plaintiffs motion to amend case caption No Judge, pursuant to pa.r.c.p. 1033, filed. 1/28/2010 Upon consideration of Plaitiff Farrell Bratton, Bruce F. Surgery and Laser Center, P.C.'s Motion to Amend Case Caption pursuant to Pa.R.C.P.1033, it is hereby ORDERED that the Plaintiffs Motion is Granted. The Prothonotary and the parties are hereby directed to amend the caption of this case to refer to the Plaintifff as Farrell Plastic Surgery and Laser Center, P.C. All referencea in Plaintiffs Complaint to "Farrell Plastic Surgery, P.C." are amended to read "Farrell Plastic Surgery and Laser Center, P.C." See ORDER filed. Copies Dlst by Court 1/28/10 2/2/2010 Artz Health Law by Charles I Artz, Esq No Judge, enters appearance on behalf of Defendant: Sakol, Peter J 2/3/2010 Answer with New Matterto complaint, filed. No Judge, Defendant: Sakol, Peter J Attorney of No Judge, Record: Bruce J Warshawsky 2/5/2010 Motion for coordination of action in No Judge, different counties pursuant to pa.r.civ.p. 213.1, filed. 3/1/2010 Plaintiffs answer to defendant's motion for No Judge, coordination of actions in different counties, filed. Certificate of Readiness for Pretrial Motion No Judge, filed by counsel for defendant(s). 3/2/2010 Certificate of service of certificate of No Judge, readiness, filed. 3/8/2010 Judge assigned to case. Curcillo, Deborah Essis User: LGARCIA ate: 5/11/2010 Dauphin County Time: 03:01 PM Complete Case History Page 3 of 3 Case: 2009-CV-15556-CV Farrell Plastic Surgery vs. Peter J Sakol Register of Actions 3/9/2010 Upon consideration of the Motion for Curcillo, Deborah Essis Coordinatiion of Action in Different Counties pursuant to Pa.R. Civ.P. 213.1 and the Answer thereto, it is hereby ORDERED that this Matter shall be stayed. It is FURTHER ORDERED that the matter docketed to 09-06023 in Cumberland County shall be stayed pending a resolution of this Coordination Motion by this Court and pending a further Order of this Court regarding Briefs, a Hearing Date and/or Oral Argument. This Order shall be certified and delivered to the Cumberland County Court of Common Pleas. See ORDER filed. Copies Dist by Court 3/9/10 3/11/2010 Hearing scheduled for (Oral Argument Curcillo, Deborah Essis 04/19/2010 08:30 AM) See Order filed copies dist by chambers. 3/12/10 4/1/2010 Hearing result for Oral Argument held on Curcillo, Deborah Essis 04/19/2010 08:30 AM: Hearing Continued. See Order filed See Order filed Hearing scheduled for (Oral Argument Curcillo, Deborah Essis 04/26/2010 01:30 PM) See Order filed copies dist by chambers 4/1/10 4/22/2010 Defendant's brief in support of defendant's No Judge, motion for coordination of actions in different counties pursuant to pa.r.c.p. 213.1, filed. 5/3/2010 Plaintiffs brief in opposition to defendant's No Judge, motion for coordination of actions in direrent counties, filed. 5/6/2010 Hearing result for Oral Argument held on Curcillo, Deborah Essis 04/26/2010 01:30 PM: Hearing Held See Order filed Upon consideration of the Motion for Curcillo, Deborah Essis Coordination of Actions in Different Counties Pursuant to Pa.R.Civ.P. 2131, the Answer thereto, oral arguments and briefs, it is HEREBY ORDERED: 1. This Action shall be transferred to the Court of Common Pleas of Cumberland County docketed to 09-6023. The caption shall read as follows: See Complete Order filed copies dist by chambers. 5/7/10 5/11/2010 The above case is hereby Transfer to the Curcillo, Deborah Essis Court of Common Pleas of Cumberland County Transferred /Withdrawn (Civil Action )No Curcillo, Deborah Essis More Docket Entries case Transfer to: M~i E` 1 1 ~~umberland County I hereby certify that the f re oing is a true and correct copy of a riginal filed. _~ Pro`~hof~otary/Cler „ gq~cfis ~C ~ User: LGARCIA .` ~ ' ~ owl ~ _ ~~.;. ~ : 1 111\\\...///111111--- \/~ y 2009 N0~ 18 Pty c. a 3 ~8, J SMIGEL, ANDERSON & SACKS, LLP Peter M. Good, Esquire River Chase Office Center pgood@sasllp.com 4431 North Front Street, 3`d Floor Darryl J. Liguori, Esquire Harrisburg, PA 17110-1778 dliguori cr sasllp.com (717) 234-2401 Attorneys for Plairetiff FARRELL PLASTIC SURGERY, P.C., IN THE COURT OF COMMON PLEAS Plaintiff, DAUPHIN CO/UNTY, PENNSYLVA/N^IA PETER J. SAKOL, M.D., LLC, CIVIL ACTION -LAW Defendant. JURY TRIAL DEMANDED NOTICE YOU HAVE BEEN SUED IN COURT. If you wish to defend against the claims set forth in the following pages, you must take action within twenty (20) days after this Complaint and Notice are served, by entering a written appearance personally or by attorney and filing in writing with the Court your defenses or objections to the claims set forth against you. You are warned that if you fail to do so the case may proceed without you and a judgment maybe entered against you by the Court without further notice for any money claimed in the Complaint or for any other claim or relief requested by the Plaintiff. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE. DAUPHIN COUNTY LAWYER REFERRAL SERVICE 213 North Front Street Harrisburg, PA 17101 (717) 232-7536 ~r NOTICE CONCERNING MEDIATION OF ACTIONS PENDING BEFORE THE COURT OF COMMON PLEAS OF DAUPHIN COUNTY The Judges of the Court of Common Pleas of Dauphin County believe that mediation of lawsuits is a very important component of dispute resolution. Virtually all lawsuits can benefit in some manner from mediation. The Court has adopted Dauphin County Local Rule 1001 to encourage the use of mediation. This early alert enables litigants to determine the best time during the life of their lawsuit for a mediation session. The intent of this early alert is to help the parties act upon the requirement to consider good faith mediation at the optimal time. The Dauphin County Bar Association provides mediation services and can be reached at 717-232-7536. Free mediation session for pro bon cases referred by MidPenn Legal Services are available through the DCBA. SMIGEL, ANDERSON & SACKS, LLP ! Peter M. Good, Esquire River Chase Office Center } . -~., p 5 '"' `' 'Z: } 3 pgood@sasllp.com 'f 1 4431 North Front Street, 3rd Floor Darryl J. Liguori, Esquire Harrisburg, PA 1 71 1 0-1 778 dliguori@sasllp.com (717) 234-2401 ~ Attorneys fa• Plaintiff FARRELL PLASTIC SURGERY, P.C., IN THE COURT OF COMMON PLEAS Plaintiff, DAUPHIN/JCOU/NTY, PENNSY~LVnANIA PETER J. SAKOL, M.D., LLC, CIVIL ACTION -LAW Defendant. JURY TRIAL DEMANDED AVISO USTED HA SIDO DEMANDADO/A EN CORTE. Si usted desea defenderse de las demandas que se presentan mas adelante en las siguientes paginas, debe tomar accion dentro de los proximos veinte (20) dias despues de la notificacion de esta Demanda y Aviso radicando personalmente o por medio de un abogado una comparecencia escrita y radicando en la Corte por escrito sus defensas de, y objecciones a, las demandas presentadas aqui en contra suya. Se le advierte de que si usted falla de tomar accion como se describe anteriormente, el caso puede proceder sin usted y un fallo por cualquier suma de dinero reclamada en la demanda o cualquier otra reclamacion o remedio solicitado por el demandante puede ser dictado en contra suya por la Corte sin mas aviso adicional. Usted puede perder dinero o propiedad u otros derechos importantes para usted. USTED DEBE LLEVAR ESTE DOCUMENTO A SU ABOGADO INMEDIATAMENTE. SI USTED NO TIENE UN ABOGADO, LLAME O VAYA A LA SIGUIENTE OFICINA. ESTA OFICINA PUEDE PROVEERLE INFORMACION A CERCA DE COMO CONSEGUIR UN ABOGADO. SI USTED NO PUEDE PAGAR POR LOS SERVICIOS DE UN ABOGADO, ES POSIBLE QUE ESTA OFICINA LE PUEDA PROVEER INFORMACION SOBRE AGENCIAS QUE OFREZCAN SERVICIOS LEGALES SIN CARGO O BAJO COSTO A PERSONAS QUE CUALIFICAN. DAUPHIN COUNTY LAWYER REFERRAL SERVICE 213 North Front Street Harrisburg, PA 17101 (717) 232-7536 AVISO REFERENCES A LA MEDIACION DE LAS ACCIONES PENDIENTES ANTES LA CORTE DE SOPLICAS COMUNES DEL CONDAD DE DAUPHIN Los jueces de la Corte de suplicas comunes del condado de Dauphin creep que la mediacion de pleitos es un componente muy importante de la resolucion del conflicto. Virtualmente todos Los pleitos pueden beneficiar de cierta manera de la mediacion. La code ha adoptado la regla local de conadado de Dauphin 1001 para animar el use de la mediacion. Esta alarma temprana permite a litigantes determiner la mejor epoca durante la vida de su plieto para una sesion de la mediacion. El intento de esta alarma temprana es actuar sobre la mediacion de la buena fe en el tiempo optimo. La asociacion de la barra del condado de Dauphin proporciona servicios de la mediacion y se puede alcanzar en 717-232-7536. La sesion Libre de la mediacion para Los favorables casos del bono se refinio por MidPenn que Los servicios juridicos estan disponibles con el DCBA. SMIGEL, ANDERSON & SACKS, LLP ~ ~ ` i~ E 1 ~~ llr3 Peter M. Good, Esquire River Chase Office Center pgood@sasllp.com 4431 North Front Street, 3rd Floor Darryl J. Liguori, Esquire Harrisburg, PA 17110-1778 dliguori@sasllp.com (717) 234-2401 Attorneys for Plaintiff FARRELL PLASTIC SURGERY, P.C., IN THE COURT OF COMMON PLEAS Plaintiff, DAUPHIN COUNTY, PENNSYLVANIA v. No. ~~~ C/ I~SJ~J~(X PETER J. SAKOL, M.D., LLC, CIVIL ACTION -LAW Defendant. JURY TRIAL DEMANDED COMPLAINT AND NOW comes Plaintiff, Farrell Plastic Surgery, P.C., by and. through its attorneys, Smigel, Anderson & Sacks, LLP, who states the following causes of action and, in support thereof, avers as follows: Parties, Jurisdiction and Venue 1. Plaintiff, Farrell Plastic Surgery, P.C. (hereinafter "Farrell Plastic Surgery") is a Pennsylvania professional corporation with a principal place of business located at 2025 Technology Parkway, Suite 204, Mechanicsburg, Cumberland County, Pennsylvania 17050. 2. Farrell Plastic Surgery is engaged in the business of providing plastic surgery and other medical services to patients in the Central Pennsylvania area. 3. Defendant Peter J. Sakol, M.D., LLC is a Pennsylvania limited liability company with a registered office address at 4212 Jonathan Lane, Hamsburg, Dauphin County, Pennsylvania 17110. 4. Peter J. Sakol, M.D. (hereinafter "Dr. Sakol") is the owner and sole member of Peter J. Sakol, M.D., LLC. 5. Dr. Sakol is a licensed Pennsylvania physician who practices in the specialty of ophthalmic plastic and reconstructive surgery . 6. This Court has jurisdiction over the parties and subject matter of the instant dispute. 7. Venue is appropriate in Dauphin County, Pennsylvania under Pennsylvania Rule of Civil Procedure 2179 as it is the county where the registered office of Defendant, Peter J. Sakol, M.D., LLC, is located. Factual Background 8. In approximately September 2001, Farrell Plastic Surgery and Dr. Sakol entered into an oral agreement by which Dr. Sakol would conduct his medical practice in Farrell Plastic Surgery's office located in Mechanicsburg, Pennsylvania. 9. Farrell Plastic Surgery would also provide Dr. Sakol with employees and practice management services. 10. The parties also agreed, among other terms, that Dr. Sakol would pay Farrell Plastic Surgery fifty percent (50%) of his collections. 11. The parties continued to abide by the terms of that agreement until on or about January 31, 2009, when Dr. Sakol unilaterally terminated the agreement and moved his practice of the Farrell Plastic Surgery office. 12. Dr. Sakol has breached the agreement by failing to pay fifty percent (50%) of his collections for the period beginning on January 1, 2009 and ending on January 31, 2009. 13. Furthermore, Dr. Sakol has breached the agreement by failing to pay Farrell Plastic Surgery fifty percent (50%) of his ongoing collections through the present. 14. Despite demands by Farrell Plastic Surgery, Dr. Sakol has refused to compensate Farrell Plastic Surgery fifty percent (50%) of its collections for the time periods in question. COUNTI Breach of Contract Farrell Plastic Surgery, P. C . v. Peter J. Sakol, M.D., LLC 15. Plaintiff, Farrell Plastic Surgery, P.C., hereby incorporates by reference thereto paragraphs 1 through 14 of this Complaint as if the same was fully set forth herein. 16. Farrell Plastic Surgery and Dr. Sakol had a valid agreement by which Dr. Sakol was to practice medicine out of an office suite leased by Farrell Plastic Surgery. 17. As part of the agreement, Dr. Sakol agreed to pay Farrell Plastic Surgery fifty percent (50%) of its collections. 18. Dr. Sakol breached the contract by failing to pay Farrell Plastic Surgery fifty percent (50%) of his collections for the period ending on January 31, 2009, and thereafter 19. As a direct and proximate result of Dr. Sakol's material breach of the contract, Farrell Plastic Surgery has suffered damages in the amount of fifty percent (50%) of Dr. Sakol's collections plus incidental and consequential damages. WHEREFORE, Plaintiff, Farrell Plastic Surgery, P.C., respectfully requests that this Honorable Court enter judgment in its favor and against Defendant, Peter J. Sakol, M.D., LLC, in an amount in excess of this county's mandatory arbitration limits together with interest, the costs of this action, and such other relief that this Court may deem reasonable. COUNT II Detrimental Reliance Farrell Plastic Surgery, P.C.v. Peter J. Sakol, M.D., LLC 20. Plaintiff, Farrell Plastic Surgery, P.C., hereby incorporates by reference thereto paragraphs 1 through 19 of this Complaint as if the same was fully set forth herein. 21. Dr. Sakol made the aforesaid misleading promises and representations that he would pay Farrell Plastic Surgery fifty percent (50%) of his collections. 22. Farrell Plastic Surgery relied to its detriment on those representations and as a result Farrell Plastic Surgery has suffered damages in the amount of 50% of Dr. Sakol's collections plus incidental and consequential damages. WHEREFORE, Plaintiff, Farrell Plastic Surgery, P.C., respectfully requests that this Honorable Court enter judgment in its favor and against Defendant, Peter J. Sakol, M.D., LLC, in an amount in excess of this county's mandatory arbitration limits together with interest, the costs of this action, attorney's fees, and such other relief that this Court may deem reasonable. COUNT III Uniust Enrichment Farrell Plastic Surgery, P. C .v. Peter J. Sakol, M.D., LLC 23. Plaintiff, Farrell Plastic Surgery, P.C., hereby incorporates by reference thereto paragraphs 1 through 22 of this Complaint as if the same was fully set forth herein. 24. Dr. Sakol has enjoyed the benefit of not having to make payments to Farrell Plastic Surgery in the amount of fifty percent (50%) of his collections despite the parties' aforementioned agreement. 25. Had Farrell Plastic Surgery known that Dr. Sakol was not going to honor their agreement, Farrell Plastic Surgery would not have contracted with Dr. Sakol. 26. Dr. Sakol would be unjustly enriched if he is permitted to retain the benefit of the amount of fifty percent (50%) of his collections. WHEREFORE, Plaintiff, Farrell Plastic Surgery, P.C., respectfully requests that this Honorable Court enter judgment in its favor and against Defendant, Peter J. Sakol, M.D., LLC, in an amount in excess of this county's mandatory arbitration limits together with interest, the costs of this action, attorney's fees, and such other relief that this Court may deem reasonable. COUNT IV In the Alternative: Quantum Meruit Farrell Plastic Surgery, P. C . v. Peter J. Sakol, M.D., LLC 27. Plaintiff, Farrell Plastic Surgery, P.C., hereby incorporates by reference thereto paragraphs 1 through 26 of this Complaint as if the same was fully set forth herein. 28. Among other terms, Dr. Sakol agreed to pay Farrell Plastic Surgery fifty percent (50%) of his collections, and Farrell Plastic Surgery agreed to lease office space to Dr. Sakol and provide Dr. Sakol with employees and practice management services. 29. Dr. Sakol has benefited by not making payments of 50% of his collections for the period beginning on January 1, 2009 and thereafter. 30. Although Dr. Sakol has been notified that the amount of 50% of his billings for the time period in question is due and owing, Dr. Sakol has refused to make payment. WHEREFORE, Plaintiff, Farrell Plastic Surgery, P.C., respectfully requests that this Honorable Court enter judgment in its favor and against Defendant, Peter J. Sakol, M.D., LLC, in an amount in excess of this county's mandatory arbitration limits together with interest, the costs of this action, attorney's fees, and such other relief that this Court may deem reasonable. Respectfully submitted, SMIGEL, ANDERSON & SACKS, LLP Date: ~/ gy ~~° y Peter M. Good, uire ID #64316 Darryl J. Liguori, Esquire ID #9171 S River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff NOV-17-2009(TUE) 17:27 FRRRELL PLASTIC SURGERY FARRELL PLASTIC SURGERY. P.C., Plaintil~', ~. PETER J. SAKOL, M.D., LLC, Defendant, (fRX)7177329011 T1V THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSY:LVANlA . No. P. 00 CIVIL ACTION -LAW JURY TRIAL DEMANDED VERiFiCATiON The undersignui he-reby vc-rifled t]~at he is the Presid~7at of the above-named Plaintiff in the foregoing action, that the factSS set forth in the Complaint are 4ruc and correct to the best of his knowledge, information, and belief, and further states that false statctncats herein arc made subject to the penalties of 18 P3C.S.A_ § 4904 relating to unsworn falsification to authorities. Date: ~~'`? ~ O ~ Lco Farrel , M.D. Farrell Plastic Surgery, P.C. FARRELL PLASTIC SURGERY, P.C., Plaintiff, v. I, Peter M. Good, Esquire, attorney for the Plaintiff in the above-captioned matter, certify PETER J. SAKOL, M.D., LLC, CIVIL ACTION -LAW Defendant. IN THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA No. JURY TRIAL DEMANDED CERTIFICATE OF SERVICE that I this day served a copy of the foregoing Com lp aint upon the person(s) indicated below by depositing a copy of the same in the United States Mail, first class, postage prepaid, at Harrisburg, Pennsylvania, and addressed as follows: Bruce J. Warshawsky, Esquire Cunningham & Chernicoff, P.C. 2320 North 2nd Street Harrisburg, PA 17110 Attorney for Defendant Date: Charles I. Artz, Esquire Artz Health Law 200 North Third Street 12th Floor, Suite 12-B Harrisburg, PA 17101 Attorney for Defendant SMIGEL, ANDERSON & SACKS, LLP /~ l~~j By: Peter M. Good, Esquire - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff r ~ r~ .~ 4; .~ ~s J 2 10 FARRELL PLASTIC SURGERY, P.C., IN THE COURT OF COMMO ~~ BCD Plaintiff, DAUPHIN COUNTY, PENNSYLVANIA • rxw~ • ,~. ~:, v. No. 2009-CV-15556-CV ~, ' ~A W J ~'4.~ ~~~ PETER J. SAKOL, M.D., LLC, CIVIL ACTION -LAW f-~ ! ~, Defendant. " • - a' ` ~' <~' ~ . ~r ,.~:_ JURY TRIAL DEMANDED ~ : ' ~ ` ~~ _~ ':: e~'; ,~.. . ORDER ~ rv .. ,/ N AND NOW, this ~ ~ day of Y~~"~'~~, 2010, upon consideration of Plaintiff Farrell Plastic Surgery and Laser Center, P.C.'s Motion to Amend Case Caption pursuant to Pa. R.C.P. 1033, it is hereby ORDERED that the Plaintiffs Motion is Granted. The Prothonotary and the parties are hereby directed to amend the caption of this case to refer to the Plaintiff as Farrell Plastic Surgery and Laser Center, P.C. All references in Plaintiffs Complaint to "Farrell Plastic Surgery, P.C." are amended to read "Farrell Plastic Surgery and Laser Center, P.C." BY THE COURT: ~ / J. Distribution: Peter M. Good, Esq., Smigel, Anderson & Sacks, 4431 North Front Street, 3rd Floor, Harrisburg, PA 17110 (Attorney for Plaintiff Farrell Plastic Surgery and Laser Center, P.C.). Bruce J. Warshawsky, Esq., Cunningham & Chernicoff, P.C., 2320 N. Second St. Harrisburg, PA 17110 (Attorney for Defendant Peter J. Sakol, M.D., LLC). SMIGEL, ANDERSON & SACKS, LLP River Chase Office Center 4431 North Front Street, 3`' Floor Harrisburg, PA 17110-1778 (717) 234-2401 Peter M. Goad, Esquire pgood@sasllp.com Darryl J. Liguori, Esquire dliguori@sasllp.com Attorneys for Plaintiff FARRELL PLASTIC SURGERY, P.C., Plaintiff, v. PETER J. SAKOL, M.D., LLC, Defendant. 1N THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA ~, No.2009-CV-15556-CV =' G' ~"N c._._ • ,-~. :,,, CIVIL ACTION -LAW N s-=~-~ ~ JURY TRIAL DEMANDED PLAINTIFF'S MOTION TO AMEND CASE CAPTION PURSUANT TO PA. R.C.P. 1033 ~., ~_~~ -G N t w AND NOW COMES, Plaintiff Farrell Plastic Surgery and Laser Center, P.C., by and through its attorneys, Smigel, Anderson & Sacks, LLP, to file the following Motion to Amend Case Caption Pursuant to Pa. R.C.P. 1033 and avers in support as follows: 1. The above referenced matter was originally filed with this Court on November 18, 2009. 2. At the time of filing, the Complaint identified "Farrell Plastic Surgery, P.C." as the corporate name of the Plaintiff. 3. However, the full corporate name of the Plaintiff is Farrell Plastic Surgery and Laser Center, P.C. 4. The case caption and all references to "Farrell Plastic Surgery, P.C." should be amended to read Farrell Plastic Surgery and Laser Center, P.C. 5. Pa. R.C.P. 1033 permits a party, either by filed consent of the adverse party or by leave of court, to at any time change the form of action, correct the name of a party or amend a pleading. An amendment may be made to conform the pleading to the evidence offered or ~~; ;x. ~~.. z ~.~n .~, ~, ~. ~r a F:- l :r. ~ .; ,~_: admitted. Pa. R.C.P. 1033. 6. Plaintiff seeks to amend the caption of this case pursuant to Pa. R.C.P. 1033 to correctly identify the full corporate name of the Plaintiff. 7. No party will be prejudiced by the relief requested in this Motion. 8. Plaintiff is not requesting a hearing or argument to decide this Motion. 9. Plaintiff does not believe that any discovery is necessary to decide this Motion. 10. Pursuant to Dauphin County Local Rule 208.3(b), counsel for all parties have been provided a copy of this Motion and proposed Order. 11. Counsel for Defendant Peter J. Sakol, M.D., LLC does concur in this Motion. WHEREFORE, Plaintiff Farrell Plastic Surgery and Laser Center, P.C. respectfully requests that this Honorable Court grant its Motion to Amend Case Caption Pursuant to Pa. R.C.P. 1033 and issue an Order directing that the Prothonotary and the parties amend the case caption to refer to the Plaintiff as Farrell Plastic Surgery and Laser Center, P.C. and that all references in Plaintiffs Complaint to "Farrell Plastic Surgery, P.C." are amended to read "Farrell Plastic Surgery and Laser Center, P.C." Respectfully submitted, SMIGEL, ANDERSON & SACKS, LLP Date: January 27, 2010 By: `~~~~"/ Peter M. Good, Esquire - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff FARRELL PLASTIC SURGERY, P.C., Plaintiff, v. PETER J. SAKOL, M.D., LLC, Defendant. 1N THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA No.2009-CV-15556-CV CIVIL ACTION -LAW JURY TRIAL DEMANDED CERTIFICATE OF SERVICE I, Peter M. Good, Esquire, attorney for the Plaintiff in the above-captioned matter, certify that I this day served a copy of the foregoing Motion to Amend Case Caption upon the person(s) indicated below by depositing a copy of the same in the United States Mail, first class, postage prepaid, at Harrisburg, Pennsylvania, and addressed as follows: Bruce J. Warshawsky, Esquire Cunningham & Chernicoff, P.C. 2320 North 2nd Street Harrisburg, PA 17110 Attorney for Defendant Date: January 27, 2010 SMIGEL, ANDERSON & SACKS, LLP ~~~ By: Peter M. Good, Esquire - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff `~" ~ aus ~ to ?q ~ ~ _.. v. ~~3 n ,n __..F .:or: t ~;~~ ~ f. ~_, ~ _. .. ~`~y~ ~ ; ~~~~~~ • `~H FARRELL PLASTIC SURGERY AND LASER CENTER, P. C. , Plaintiff v. PETER J. SAKOL, M.D., LLC, Defendant IN THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA NO: 2009-CV-15556-CV CIVIL ACTION -LAW " a." JURY TRIAL DEMANDED ,:~ .~ --- ENTRY OF APPEARANCE ~ N -~ ~ ,.... rv -~ a w ca Please enter my appearance on behalf of Defendant, Peter J. Sakol, M.D., LLC, in the above captioned matter. Respectfully submitted, ARTZ HEAL H LAW By: Charles I. A~ Esquire Supreme Court I.D. #55747 200 North Third Street, Suite 12-B Harrisburg, PA 17101 (717) 238-9905 Attorneys for Defendant, Peter J. Sakol, M.D., LLC DATED: February Z , 2010 1 • T'~ CERTIFICATE OF SERVICE I, Charles I. Artz, Esquire, hereby certify that I am this day serving a copy of the foregoing document upon the person(s) and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure, by depositing a copy of the same in the United States Mail, Harrisburg, Pennsylvania, with first-class postage prepaid, as follows: Peter M. Good, Esquire Darryl J. Liguori, Esquire Smigel, Anderson & Sacks, LLP River Chase Office Center 4431 North Front Street Third Floor Harrisburg, PA 17110 DATED: February 2010 Charles I tz, Esquire '~ ' Bruce J. Warshawsky, Esquire PA Supreme Court ID #58799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second Street Harrisburg, PA 17110 ~~ R ~~ n r`'' Mailing Address: P.O. Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 Attorneys for Defendant FARRELL PLASTIC SURGERY AND IN THE COURT OF COMMON PLEAS LASER CENTER, P.C., DAUPHIN COUNTY, PENNSYLVANIA Plaintiff N0:2009-CV-15556-CV v. CIVIL ACTION -LAW PETER J. SAKOL, M.D., LLC, JURY TRIAL DEMANDED Defendant o o NOTICE TO PLEAD r~"r, ---- ..~, _ - ~ -, f's"E f TO: Farrell Plastic Surgery and Laser Center, P.C. ~"~ c/o Peter M. Good, Esquire and Darryl J. Liguori, Esquire ~ ~_ ~ Smigel, Anderson & Sacks, LLP -- River Chase Office Center _. 4431 North Front Street Third Floor Harrisburg, PA 17110 YOU ARE HEREBY NOTIFIED TO PLEAD TO THE ENCLOSED ANSWER WITH NEW MATTER WITHIN TWENTY (20) DAYS FROM THE DATE OF SERVICE HEREOF OR A DEFAULT JUDGMENT MAY BE ENTERED AGAINST YOU. & CHERNICQFF, P.C. By B e J. Warsha y, Esquire P Supreme C rt ID# 58799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second. Street Harrisburg, PA 17110 Telephone: (717) 238-6570 Date: February 3, 2010 -2- Bruce J. Warshawsky, Esquire PA Supreme Court ID #58799 CUNNINGHAM & CHERNICOFF, P.C. '~~. _ 2320 North Second Street ., . ~ Harrisburg, PA 17110 ~~. c~.~ -° e .~~`` `'' Mailing Address: ,~;" ~,, P.O. Box 60457 `'" ~~ ~" ~;; Harrisburg, PA 17106-0457 ~~- (717) 238-6570 -- o Attorneys for Defendant FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Plaintiff v. PETER J. SAKOL, M.D., LLC, Defendant IN THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA NO: 2009-CV-15556-CV CIVIL ACTION -LAW JURY TRIAL DEMANDED ANSWER WITH NEW MATTER TO COMPLAINT AND NOW, comes the Defendant, Peter J. Sakol, M.D., LLC ("Sakol"), by and through its counsel Cunningham & Chernicoff, P.C., which submits its Answer with New Matter to Complaint and in support thereof avers as follows: 1. Admitted upon information and belief. 2. Admitted. 3. Admitted. 4. Admitted. 5. Denied as stated. Dr. Sakol practices in the speciality of ophthalmology, specializing in ophthalmic plastic and reconstructive surgery and is Board Certified in ophthalmology by the American Board of Ophthalmology. 6. The averments of this Paragraph are legal conclusions to which no response is required. 7. The averments of this Paragraph are legal conclusions to which no response is required. 8. Denied as stated. In approximately, March, 2001, Farrell and Sakol began a business relationship whereby their practices were operated independently of each other but under an oral agreement between Farrell and Sakol (the "Oral Agreement") at Farrell's office located at 2025 Technology Parkway, Suite 204, Mechanicsburg, Cumberland County, Pennsylvania 17050, (the "Farrell Practice Location"). The terms, conditions and specifics of the Oral Agreement were as follows: a. Farrell was the Tenant under a Lease with the Landlord (at the Farrell Practice Location) with Sakol operating without any rights of tenancy but as a licensee within the Farrell Location; b. Farrell paid for all the operating overhead' and provided all the labor (Sakol had no others employees other than Dr. Sakol while Sakol was ~ Except for Sakol's malpractice coverage, direct advertising and Botox and other supplies as identified below. -4- located at the Farrell Practice Location) to provide a variety of services to Sakol as follows: i. Billing; ii. Collection; iii. Office Management; iv. Accounts Receivable Management; and v. Substantive Medical Assistance. In connection therewith, Farrell had complete control over the aforementioned servicesz to be provided Sakol including, but not limited to, the supervision of and that the methods by which billing and collection were handled, and the amount of time Farrell's Office Manager, Gail Erdman ("Ms. Erdman"), was permitted to devote to collection efforts on Sakol's behalf. c. While Sakol's practice was located at the Farrell Practice Location, Sakol owned its own medical equipment and had specified rooms for its practice for ophthalmology. Sakol was permitted to utilize Farrell's "minor procedure room" and some surgical equipment and lasers for various procedures; d. Sakol and Farrell shared a computerized billing system in which both Farrell and Sakol had access to the basic demographic information about Sakol patients and Farrell patients, limited to the names, addresses, dates 2 Except that Dr. Sakol, on behalf of Sakol, controlled his own time schedule. -5- of birth, social security numbers, identification of primary insurance carriers and any specific insurance company account numbers (the "Common Database"). Each practice, Sakol and Farrell, respectively maintained their own paper file and computerized medical and patient records and computerized billing system separate and distinct from each other's (the "Sakol Separate Database" and "Farrell Separate Database"), although under the same computer hardware and software system and maintained by the same computer hardware and software vendor. Dr. Sakol only accessed the Sakol Separate Database and the Common Database, while Farrell, through its employees, had access to the Farrell Separate Database, the Sakol Separate Database and the Common Database, as required for the management of both medical practices; As remuneration for the licensed use of the Farrell Practice Location by Sakol, as well as the various services provided to Sakol by Farrell as set forth herein (collectively the "Farrell Services"), Sakol paid Farrell, under the Oral Agreement, fifty percent (50%) of each prior month's cash collections3 received by Sakol, which was calculated each month by Farrell (by Ms. Erdman) (the "Sakol Payment"); f. Both parties has a reasonable expectation that neither party would commit ' The remuneration changed over the course of their relationship to "carve out" certain items from the total cash collections of the prior month from which the fifty percent (50%) payment was made. These included Sakol's malpractice premiums, "direct" advertising expenses and the amounts Sakol paid to Farrell for Botox and other supplies all of which were reductions from the amount against which this fifty percent (50%) payment would be calculated. -6- any fraud while the Oral Agreement was in effect that might possibly damage the other party; and g. The Oral Agreement was terminable at will by either Sakol or Farrell. 9. Denied as stated. Dr. Sakol hereby incorporates by reference its answers to Paragraph 8 above as if more specifically set forth therein. 10. Denied as stated. Dr. Sakol and Plaintiff agreed that on a monthly basis, by the end of the following month, Dr. Sakol would pay to Plaintiff fifty percent (50%) of all cash collected by Dr. Sakol in the month prior but adjusted. The remuneration changed over the course of their relationship to "carve out" certain items from the total cash collections of the prior month from which the fifty percent (50%) payment was made. These included Sakol's malpractice premiums, "direct" advertising expenses and the amounts Sakol paid to Farrell for Botox and other supplies which were reductions from the amount against which this fifty percent (50%) payment would be calculated. l 1. Denied as stated. On January 23, 2009, Dr. Sakol terminated the oral agreement by and between Plaintiff and Dr. Sakol ("Oral Agreement") and termination of the BAA (defined herein). 12. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has numerous defenses to Plaintiff s claims that it did not receive any payment in January, 2009. By way of further answer, Dr. Sakol terminated the Oral Agreement on January 23, 2009. 13. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has -7- numerous defenses to Plaintiff s claims that it is entitled to any payments after termination of the Oral Agreement. By way of further answer, Dr. Sakol hereby incorporates by reference his answer to Paragraph 10 above. 14. Denied as stated. While it is admitted Plaintiff has demanded payment and Dr. Sakol has refused payment, Plaintiff is not entitled to any compensation under the Oral Agreement by and between the Plaintiff and Dr. Sakol for the reasons set forth above and below. WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court enter Judgment in its favor, its costs and attorney fees and other just relief the Court deems appropriate. COUNTI BREACH OF CONTRACT FARRELL PLASTIC SURGERY, P.C. V. PETER J. SAKOL, M.D., LLC 15. Dr. Sakol incorporates by reference his answers to Paragraphs 1 through 14 above as if more specifically set forth herein. 16. Denied as stated. It is admitted that Dr. Sakol and Plaintiff operated under an Oral Agreement, the terms and conditions of which are set forth above in Dr. Sakol's Answers to Paragraphs 8 and 10 above. 17. Denied as stated. Dr. Sakol and Plaintiff agreed that on a monthly basis, by the end of the following month, Dr. Sakol would pay fifty percent (50%) of all cash collected in the month prior as adjusted. The remuneration changed over the course of their relationship to "carve out" certain items from the total cash collections of the prior month from which the fifty -8- percent (50%) payment was made. These included Sakol's malpractice premiums as part of its direct advertising expenses and the amounts Sakol paid to Farrell for Botox and other supplies which were reductions from the amount against which this fifty percent (50%) payment would be calculated. 18. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has numerous defenses to Plaintiff s claims that it is entitled to any payments after termination of the Oral Agreement. By way of further answer, Dr. Sakol hereby incorporates by reference his answer to Paragraph 10 above. 19. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has numerous defenses to Plaintiff s claims that it is entitled to any payments after termination of the Oral Agreement. By way of further answer, Dr. Sakol terminated the Oral Agreement on January 23, 2009. By way of further answer, with respect to "incidental and consequential damages" Plaintiff is not entitled to any such damages as such damages are not available to Plaintiff even if a breach of the Oral Agreement is proven and, further, with respect to such damage, after reasonable investigation, Dr. Sakol is without sufficient information or knowledge to form a belief as to the truth of the matters asserted herein. Therefore, strict proof thereof is hereby demanded at the time of trial. -9- WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court enter Judgment in its favor, its costs and attorney fees and other just relief the Court deems appropriate. COUNT II DETRIMENTAL RELIANCE FARRELL PLASTIC SURGERY, P.C. V. PETER J. SAKOL, M.D., LLC 20. Dr. Sakol incorporates by reference his answers to Paragraphs 1 through 19 above as if more specifically set forth herein. 21. Denied as stated. Dr. Sakol incorporated by reference its answers to Paragraph 10 above as if more specifically set forth herein. 22. The averments of this Paragraph are legal conclusions to which no response is required. To the extent that a response is deemed to be required, Dr. Sakol incorporates by reference it answers to Paragraph 19 above as if more specifically set forth herein. As to the averment that Plaintiff "relied to its detriment", Dr. Sakol, after reasonable investigation, Dr. Sakol is without sufficient information or knowledge to form a belief as to the truth of the matters asserted herein. Therefore, strict proof thereof is hereby demanded at the time of trial. WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court enter Judgment in its favor, its costs and attorney fees and other just relief the Court deems appropriate. -10- COUNT III UNJUST ENRICHMENT FARRELL PLASTIC SURGERY, P.C. V. PETER J. SAKOL, M.D., LLC 23. Dr. Sakol incorporates by reference his answers to Paragraphs 1 through 22 above as if more specifically set forth herein. 24. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has numerous defenses to Plaintiff s claims that it is entitled to any payments after termination of the Oral Agreement. By way of further answer, Dr. Sakol hereby incorporates by reference his answer to Paragraph 10 above. 25. After reasonable investigation, Dr. Sakol is without sufficient information or knowledge to form a belief as to the truth of the matters asserted herein. Therefore, strict proof thereof is hereby demanded at the time of trial. 26. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has numerous defenses to Plaintiff s claims that it is entitled to any payments after termination of the Oral Agreement. By way of further answer, Dr. Sakol hereby incorporates by reference his answer to Paragraph 10 above. WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court enter Judgment in its favor, its costs and attorney fees and other just relief the Court deems appropriate. -11- COUNT IV IN THE ALTERNATIVE: QUANTUM MERUIT FARRELL PLASTIC SURGERY, P.C. V. PETER J. SAKOL, M.D., LLC 27. Dr. Sakol incorporates by reference his answers to Paragraphs 1 through 26 above as if more specifically set forth herein. 28. Denied as stated. Dr. Sakol incorporates by reference its answers to Paragraphs 8 and 10 above as if more specifically set forth herein. 29. The averments of this Paragraph are legal conclusions to which no response is required. By way of further answer, as is more specifically set forth below, Dr. Sakol has numerous defenses to Plaintiff s claims that it is entitled to any payments after termination of the Oral Agreement. By way of further answer, Dr. Sakol hereby incorporates by reference his answer to Paragraph 10 above. 30. Denied as stated. While it is admitted Plaintiff has demanded payment and Dr. Sakol has refused payment, Plaintiff is not entitled to any compensation under the Oral Agreement by and between the Plaintiff and Dr. Sakol for the reasons set forth above and below. WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court enter Judgment in its favor, its costs and attorney fees and just relief the Court deems appropriate. NEW MATTER 31. Dr. Sakol incorporates by reference his answers to Paragraphs 1 through 30 above as if more specifically set forth herein. -12- 32. Plaintiff s Complaint fails to state a claim upon which relief may be granted. 33. Plaintiffs Complaint are barred by the doctrine of Release for the reasons set forth below. 34. Plaintiffs Complaint are barred by the doctrine of Estoppel for the reasons set forth below. 35. Plaintiffs Complaint are barred by the doctrine of Waiver for the reasons set forth below. 36. Plaintiff s claims are barred by the doctrine of Accord and Satisfaction as follows: a Undersigned counsel corresponded to Farrell by letter dated February 18, 2009, sent via facsimile and regular mail, a true and correct copy of which is attached hereto as Exhibit "A". b Undersigned counsel's February 18, 2009 correspondence contained, inter alia, a proposal for Sakol to pay Farrell the amount of $11,346.22 (the "Sakol Offer"). c Farrell responded by facsimile dated February 18, 2009, in which Farrell agreed to the Sakol Offer but including counterprovisions requiring payment by March 2, 2009 and a demand for a deduction for Ms. Erdman's work after January 23, 20094 (the "Farrell Counter"). A true and correct copy of said facsimile dated February 18, 2009 is attached hereto as Exhibit "B". d. Undersigned counsel provided Farrell's counsel with a first draft of a 4 Identified in the Sakol Offer as $148.75 (the "Erdman Adjustment"). -13- Confidential Settlement Agreement and Release ("Agreement") on February 25, 2009, just seven (7) days after the Farrell Counter was proposed and five (5) days before March 2, 2009. A true and correct copy of the covering email to Farrell's counsel with the attached Agreement is attached hereto as Exhibit "C". The Agreement represents a binding contract to terminate the Oral Agreement as it contains: i. The amount of the Farrell Counter, (the Sakol Offer plus the Erdman Adjustment , a total of $11,494.97), as consideration (the "Settlement Monies"); ii. A complete Mutual Release; iii. No admission of liability for either party; iv. Reciprocal Confidentiality and Non-Disparagement provisions; and v. Other ordinary release and settlement provisions. e. The day before, February 24, 2009, undersigned counsel advised Farrell's counsel by email that the Settlement Monies were in undersigned counsel's Escrow Account and ready to be paid upon execution of the Agreement, a true and correct copy of which is attached hereto as Exhibit "D".. f. On March 2, 2009, Farrell's counsel advised undersigned counsel that she had not yet met with Dr. Farrell at 4:16 p.m. by that date. As a result, the Agreement was not signed by March 2, 2009. g. On March 4, 2009, Farrell's counsel advised undersigned counsel that she -14- would be meeting with Farrell the following Monday (March 9, 2009) to review the Agreement. h. For the first time on March 5, 2009, Farrell, through counsel, advised undersigned counsel that the Agreement which accepted and embodied the terms and conditions of the Farrell Counter would not be executed by Farrell. i. For the first time on March 10, 2009, Farrell, through counsel, demanded that Sakol pay a percentage of the Sakol cash collections which post-date the termination of the Oral Agreement. 37. Plaintiff s claims are barred in whole and in part by the doctrine of Unclean Hands due to fraud committed during the Oral Agreement, to wit: a. Farrell's former Office Manager, Gail C. Erdman, avers, in her Answer to Complaint with New Matter in the case Farrell Plastic Surgery and Laser Center, P.C, v. Gail Erdman, 09-7616, Cumberland County, Pennsylvania (the "Erdman Lawsuit") (a copy of which is attached hereto as Exhibit "E", the "Erdman Pleading") that she "...became aware that Dr. Farrell was perpetrating fraud upon various insurance companies, by representing that he was performing various procedures on patients when in fact others who were not accredited with the insurance companies to perform those procedures were actually performing them, primarily his wife.". Erdman Pleading, ¶23. She also avers, "at least on one occasion he requested that [Ms. Erdman] participate in altering records in anticipation of an insurance -15- audit." Erdman Pleading, ¶24. b. Two (2) other former employees of Farrell, Rachelle Hoffman and Jennifer Messick, both experienced the following: i. Dr. Deborah Farrell treating certain patients and completing their treatment charts, while Dr. Leo Farrell signed those treatment charts as if he were the providing physician; ii. Observed other employees of Farrell, Christy Warfel and Angie Sterner, altering patient charts prior to an insurance audit and change the designation of Dr. Deborah Farrell thereon, identified as "DMF", to "Farrell" to defraud the auditing insurance company by suggesting that Dr. Leo Farrell performed the services as indicated on the altered records; and iii. Were told by Ms. Erdman about "upcodingi5 in Farrell billing about which Ms. Erdman communicated her concern to them. 38. Plaintiffs claims are barred in whole and in part by the doctrine of Unclean Hands due to its intentional and injurious conduct towards Sakol after the termination of the Oral Agreement, to wit: a. Sakol's patients were told by Farrell that Sakol's new practice location was unknown notwithstanding undersigned counsel's repeated requests to correct this course of conduct and despite being advised about both the Performing one level of medical service and billing an insurance company for a more complex and expensive level of medical service. -16- Sakol Location and Temporary Location in correspondence; b. Upon information and belief, Sakol's patients were being diverted by Farrell for procedures for Dr. Deborah Farrell to perform; c. Farrell continued to include Dr. Sakol's name on the Farrell letterhead; d. Prospective patients, looking for Dr. Sakol and who called Farrell, were advised that Farrell had no forwarding information regarding Dr. Sakol or his practice; e. Farrell, in its facsimile dated February 17, 2009, made patently false statements which constitute defamation per se; £ Dr. Farrell further defamed Dr. Sakol by communicating to third-parties certain misinformation about the termination of their business relationship; g. Farrell continued to use Dr. Sakol's likeness, image and inclusion of his name on the Farrell website; h. Farrell refused to remove Dr. Sakol's name with Verizon and other phonebooks causing confusion with Sakol's own Verizon and other phonebook listings; i. Farrell placed classified advertisements with the Patriot News and instructed the Patriot News to bill Sakol; j. Farrell instructed its medical answering service to withhold Sakol's contact information from callers who inquired of same; k. On or about April 10, 2003, the parties supplemented the Oral Agreement by entering into a Business Associate Agreement (the "BAA"), a true and -17- correct copy of which is attached hereto as Exhibit "F". The BAA was executed by Dr. Sakol on behalf of Sakol and by Ms. Erdman on behalf of Farrell as its Office Manager; and 1. Farrell intentionally and repeatedly utilized the Sakol Separate Database to its benefit and to Sakol's detriment as set forth below in violation of the BAA and HIPAA. 39. Plaintiff violated the BAA after its termination which violation serves as a defense to any claim Plaintiff asserts for monetary damages as follows: a. Farrell continues to possess the Sakol Separate Database which violates the BAA and HIPAA. b. Sakol, has, on repeated occasions since termination of the Oral Agreement demanded that Farrell destroy the Sakol Separate Database. Upon information and belief, it is averred that on or about September 1, 2009, Farrell, accessed the Sakol Separate Database, identified those Sakol patients who had previously treated with Sakol for Rosacea6 (whose medical records are contained in the Sakol Separate Database and who never were a patient of Farrell, identified herein as "Sakol's Rosacea Patients"), and sent a mailing to one or more of the Sakol's Rosacea Patients, an undated letter with a copy of the envelope which accompanied it bearing a postmark of September 1, 2009, is hereby attached as Exhibit The medical condition is one of many data field entries contained within the Sakol Separate Database. Since the Sakol Separate Database may be sorted by medical condition, Farrell's access to and use of the Sakol Separate Database to target Sakol's Rosacea Patients is quite easy to do. -18- "G" (the "Farrell First Mailing"). Other Sakol patients (who were not Farrell Patients) who did not suffer from the medical condition of Rosacea, did not receive the Farrell First Mailing. d. Many of Sakol's Rosacea Patients contacted Dr. Sakol after their receipt of the Farrell First Mailing, to complain about receiving the Farrell First Mailing and inquired about whether Farrell had access to their personal and private health information. e. Although the BAA terminated on January 23, 2009, when the Oral Agreement was terminated, Farrell, through counsel, denied that the BAA was terminated and, therefore, Farrell was advised, through undersigned counsel's letter to Farrell's counsel dated September 3, 2009, a true and correct copy of which is attached hereto as Exhibit "H" that the BAA was terminated and that Sakol's PHI must be destroyed. f. Undersigned counsel notified Farrell's counsel by letter dated September 10, 2009 about the Farrell First Mailing, a true and correct copy of which is attached hereto as Exhibit "I". g. Farrell's (and Sakol's) computer hardware and software vendor, STI Computer Services, Inc. ("STI"), has expressed, in writing, that it is feasible for Farrell to destroy Sakol's Separate Database as set forth in the attached electronic mail message dated October 20, 2009 from STI Computer Services, Inc. to undersigned counsel (the STI Email"), a copy of which was attached to a letter dated October 26, 2009 from Attorney -19- Charles I. Artz ("Mr. Artz") (Sakol's Co-Counsel in this action) to Farrell's counsel (the "Artz Letter"). A copy of the STI Email is attached hereto as Exhibit "J". h. The Artz Letter places Farrell, through counsel, on notice that Farrell, inter alia, violated the BAA and HIPAA, to Sakol's detriment as follows: (1) The BAA obligated Farrell to return or destroy the Sakol Separate Database, once the relationship was terminated. (2) The HIPAA Privacy Regulations impose a legal obligation on Sakol to demand destruction of all private health information (as defined under HIPAA, hereafter "PHI") Farrell received from it or created on Sakol's that Dr. Farrell still maintains in any form, and retain no copies of such information. 45 C.F.R. § 164.504(e)(2)(I). (3) The cessation of any billing and collection services or any other services that fall within the definition of a Business Associate, under the BAA, demonstrates Farrell has no legal basis to either retain, access or use any of Sakol's PHI. 45 C.F.R. § 160.103 (permitting use and disclosure of PHI for limited functions). (4) The only way Farrell could have sent [the Farrell First Mailing] to [Sakol's Rosacea Patients would be to have accessed not only Sakol's patient names and addresses, but also to access those patients' prior treatment records and ICD-9 diagnosis codes, which would only be contained in the Sakol Separate Database. -20- (5) Farrell knowingly obtained and used individually identifiable health information relating to individuals with the intent to use it for commercial advantage, and personal gain in violation of 42 U.S.C. § 1320d-6(a)(2)-(3) and § 1320d-6(b)(3). (6) The HITECH Act has amended the aforementioned criminal sanctions by adding a new sentence: A person shall be considered to have obtained or disclosed individually identifiable health information in violation of this part if the information is maintained by a covered entity and the individual obtained or disclosed such information without authorization. HITECH Act, § 13409. (7) Sakol maintained the data and demanded its destruction. Farrell refused to do so. Dr. Farrell retained the PHI without permission, then obtained and disclosed it without authorization from Sakol or any patient for a commercial purpose. i. Notwithstanding previous notifications regarding potential HIPAA violations and violations of the BAA, Farrell sent another mailing, a postcard to Sakol Rosacea Patients , a true and correct copy of which is attached hereto as Exhibit "K" some time in the middle of November, 2009 (the "Farrell Second Mailing") -21- As part and parcel of this scheme to contact the Sakol Rosacea Patients, Farrell had previously registered a fictitious name with the Pennsylvania Department of State on or about Apri120, 2009, "Farrell Laser and Cosmetic Medicine Center" which, upon information and belief, is a vehicle under which Farrell is marketing Dr. Deborah Farrell's practice within Farrell to unfairly compete with Sakol by using the Sakol Separate Database as evidenced by the Farrell First Mailing and Farrell Second Mailing. k. A copy of the Farrell Second Mailing was provided to Farrell's counsel by undersigned counsel on November 25, 2009. 1. Sakol was contacted by many of the Sakol Rosacea Patients who received the Farrell Second Mailing, who were upset about receiving it and inquiring about what they could do to stop such mailings from Farrell. m. Upon information and belief, numerous Sakol Rosacea Patients have filed Health Information Privacy Complaints with the U.S. Department of Health and Human Services Office for Civil Rights following their receipt of the Farrell Second Mailing. Further, the Farrell First Mailing and/or Farrell Second Mailing may be subject to criminal sanctions and/or administrative sanctions under the State Board of Medicine's Rules and Regulations. n. The terms of the BAA set forth above require to destroy the Sakol Separate Database. -22- o. Because of Farrell's actions of accessing the Sakol Separate Database and using it for its own personal gain by marketing to Sakol's Rosacea Patients, it is possible that a HIPAA violation occurred for which Sakol may be required to face an administrative action therefor. 40. During the course of the relationship by and between Plaintiff and Sakol, the parties never intended for, accounted for or anticipated that Plaintiff would be entitled to any amount of Sakol's cash collections following the termination of the BAA and the Oral Agreement to wit: a. As remuneration for the licensed use of the Farrell Practice Location by Sakol, as well as the various services provided to Sakol by Farrell as set forth herein (collectively the "Farrell Services"), Sakol paid Farrell, under the Oral Agreement, fifty percent (50%) of each prior month's cash collections' received by Sakol, which was calculated each month by Farrell (by Ms. Erdman) (the "Sakol Payment"); b. During the entire term of their relationship under the Oral Agreement including but not limited to during the discussions in late 2008 and early 2009, Dr. Leo Farrell and Dr. Sakol, nor their practice respective accountants, never discussed or agreed upon anything other than fifty percent (50%) payment of the prior month's cash collections (as adjusted) The remuneration changed over the course of their relationship to "carve out" certain items from the total cash collections of the prior month from which the fifty percent (50%) payment was made. These included Sakol's malpractice premiums, "direct" advertising expenses and the amounts Sakol paid to Farrell for Botox and other supplies all of which were reductions from the amount against which this fifty percent (50%) payment would be calculated. -23- as compensation for the services rendered by Farrell to Sakol and as set forth above. Furthermore, while the Oral Agreement was in effect: Farrell never reviewed Sakol's accounts receivable with Sakol either on a regular basis (monthly, quarterly or annual) or on an ad hoc basis. ii. Farrell never claimed entitlement to 50% of Sakol's accounts receivable that were uncollectible. iii. It is believed, and therefore averred, that Farrell never, in any financial, tax or management report, identified the value of 50% of Sakol's accounts receivable as an asset of Farrell. iv. Dr. Sakol provided occasional services as an independent contractor to Farrell and to Farrell's cosmetic patients for which Sakol was paid a net amount of 50% of the fees Farrell collected for such services which, during the beginning of the Oral Agreement was a more significant part of the Sakol Payment but which dissipated over time and ultimately stopped during the course of the Oral Agreement. Such independent contractor services and the fees collected by Farrell thereunder allowed Sakol to pay Farrell for the services rendered under the Oral Agreement prior to the full maturity of the Sakol Practice. c. At some point in the Fall, 2008, Dr. Leo Farrell approached Dr. Sakol about altering the payment terms of the Oral Agreement. -24- d. Dr. Leo Farrell advised Dr. Sakol that the Sakol payments were insufficient to cover the Sakol share of the actual cost of the services Farrell provided to Sakol under the Oral Agreement and that Sakol had to pay more, in the form of a flat fee (and not a percentage of Sakol cash collections). e. Thereafter, Dr. Sakol and Dr. Leo Farrell had numerous discussions regarding the financial justification for Farrell's request for increased remuneration and the proposed changes to the Oral Agreement and payments made thereunder, as did Sakol's accountant and Farrell's accountant. f. It is believed, and therefore averred, that Sakol's accountant and Farrell's accountant exchanged information about Farrell's finances during early January, 2009. g. At some point in early January, 2009, Dr. Leo Farrell demanded that Sakol pay the flat fee of $30,000.00 to commence retroactively to January 1, 2009, which Dr. Sakol refused and which caused him to begin to evaluate the termination of the Oral Agreement on financial grounds. In addition, Farrell's accountant told Dr. Sakol that if Sakol did not pay the demanded flat fee of $30,000.00 per month, Sakol should terminate the Oral Agreement with Farrell and leave. h. At no time during the negotiations and discussions between Dr. Sakol and Dr. Leo Farrell or during the discussions between Farrell and Sakol's -25- respective accountants, did any discussion about a "transition" from the old payment arrangement under the Oral Agreement and the $30,000.00 per month flat fee payment demanded by Farrell arise. That is, Dr. Leo Farrell and Farrell's accountant represented to Dr. Sakol and Sakol's accountant that the flat fee had to begin on January 1, 2009, without any adjustment. 41. Farrell otherwise breached the Oral Agreement as follows: a. Upon information and belief, Dr. Leo Farrell instructed Ms. Erdman to focus her collection and accounts receivable efforts on Farrell and devote much less time to Sakol regarding same during the time the Oral Agreement was in effect. This practice continued up through and including the middle of 2008. b. Dr. Leo Farrell, sometime in the middle of 2008, instructed Ms. Erdman to accelerate the collections and accounts receivable work for Sakol, for reasons unknown to Sakol. c. Insurance companies typically dishonor claims submitted late and for which incomplete documentation is submitted or for which documentation is not provided in response to inquiries and request for information from those same insurance companies. d. Because Dr. Leo Farrell instructed his employee, Ms. Erdman, to spend less time on the Sakol collections, many of the Sakol claims submitted to insurance companies were either submitted late or with insufficient -26- documentation all of which resulted in Dr. Sakol's collections suffering and accounts receivable soaring. e. At this juncture, an amount yet to be determined, but which upon information and belied is greater than $50,000.00 is still uncollected and remains on Sakol's accounts receivable ledger (and is thus, uncollectible) for services performed by Sakol prior to the termination of the Oral Agreement on January 23, 2009. f. The aforementioned conduct, that is Farrell's manipulation of the Ms. Erdman's efforts in connection with Sakol's collections is a breach of the Oral Agreement. 42. The Sakol Payment, which was always made during the month following the month in which the Farrell Services were provided, was, under the Oral Agreement, consideration for the Farrell Services provided for the previous month. As such: a. Any payment due and owing to Farrell is limited to the period from January 1, 2009 to January 23, 2009, the date the Oral Agreement was terminated; and b. Since no Farrell Services were provided after January 23, 2009, Farrell is not entitled to any compensation from Sakol subsequent to that date. WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court enter Judgment in its favor, its costs and attorney fees and other just relief the Court deems appropriate. -27- CUNNINGHAM & CHERNICOFF, P.C. By ru J. ar wsky, Es ire PA Supreme Court ID# 8799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second. Street Harrisburg, PA 17110 Telephone: (717) 238-8187 Attorneys for Defendant Date: February 3, 2010 -as- EXHIBIT `A' .~ J°~~ °~ ~~~ CUNNINGHAM & CHERNICOFF, P. C. ROBERT 8. CHBRMCOFF IrtARC w wrizlc ATTORNEYS AT LAW BRVC$ j. wl-xsHAwsxx P.O. BOX 60457 KHLLY M IURGHT HARRISBURG, PfiNNSYLVANIA 17106-0457 TRACY 4 UPDIICS TELBPHONB (717)238-b570 FAX (717) 238.4809 February 18, 2009 VIA FACSIMILE: (717) 732-9011 and REGULAR MAIL Leo D. Farnll, M.D. Farrell Plastic Surgery and Laser Center, P.C. 2025 Technology Parkway Suite 204 Mechanicsburg, PA 17050 PIERSH6Y TE[.EPHON (717)539-2833 IRS NO.23-2274135 Srnet Addreax 2320 N. 2nd St<eet Harciebuig, PA 17110 Writer's Direct Emaii: biwCZa cciawoc.com RE: Peter J. Sakol, M.D., LLClLeo D. Farrell, M.D. and Farnll Plastic Surgery and Laser Center, P.C. File No: 600409 Dear Doctor Farrell: Thank you for your facsimile which I received yesterday at 4:35 p.m. and which responds to my letter dated February 17, 2009 faxed to your office earlier in the day. It is obvious that there are facts in dispute with respect to Dr. Sakol's departure and the events which have transpired since, to date. Nonetheless, it is imperative that you and Dr. Sakol execute an Settlement Agreement and Mutual Release to allow both of you to move on with your professional lives. I will draft that Settlement Agreement and Mutual Release for your consideration by no later than February 23, 2009 and expect that it will executed and payment made to you in accordance with the calculations contained in my February 1?, 2009 correspondence by no lager than March 2, 2009. If you wish, I will send a draft of the Settlement Agreement and Mutual Release to your counsel. If I do not hear from you by noon, February 23, 2009, I will forward the document directly to you. •,:'> CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW Leo D. Farrell, M.D. February 18, 2009 Page 2 One matter which is of grave concern to Dr. Sakol is the defamatory statements contained in Paragraph 6 of your February 17, 2009 facsimile. These statements are patently false and constitute defamation per se. Dr. Sakol has also been advised by certain third-parties (unsolicited, that is, they contacted him) that you have been coaununicating misinformation about the termination of your business relationship. This misinformation may also be actionable in defamation. Therefore, the Settlement Agreement and Mutual Release shall contain strict confidentiality provisions and representationsthat the parties have kept the circumstances relating to the termination of your business relationship and the terms and conditions of the Settlement Agreement and Mutual Release confidential beginning today, February 18, 2009. I have instructed Dr. Sakol regarding his responsibility for confidentiality and by virtue of the receipt of this correspondence, you are similarly instructed. Please be guided accordingly. Very truly yours, C GHAM 8t C1=iER1VICOFF, P.C. .~ Bivice J. W wsky BJW/ja cc Peter Sakol. M.D. g:~.~e~vv~oocs~s,~-~ca..i~w~.ti B~..u.os~eo9.wpa EXHIBIT B' ' FEB-18-2009(YEO) 17:12 FRRRELL PLRSTIC SUR6ERy (FAX)7177329011 P. 001/00 ,~'arreil Mastic Surgery & Laser Center, ~. ~ . 2025 xeGhaoIogy Parkway, Suite 204 Mecha~lnicsburg, PA 17050 (717) 732-9000 (717) 732-9011 FAX ~'x7.ANSNx[SSItaN Dste: °L ! ~ g1 ~~ Fi~cNumbcr: vZ ~ ~~ ~/~'~~ Fttgeu~: (iaolutiin~ coyer sheet) . If you do not receive the imlicated pt~r, please call our office at (71 ~ 732-9000 Mctrsstg~ ~~~-~ da E ~ e.~' .g- l'.~+~e a fG ~h /`7 J4~. e.1~- Z ~ 'a.~ca S ~v J fiCbv j- ct~ ct~ tr•~+~ /tea ,-~ ,~t~ w or>'~ ~ ~1s ~~nr n-~ it F~4,-- 7"A~ vtla~ a 3 1 3-+~ S . ~ N D ~/e ye ~ ~ YW J1-w D /t' C ~~ ~ ~ ~' J ~ S re. ~'~'~~ ~ a.rJ~"_ ~~~ra'`h^'e...'~' ~V ~TG/o7y'1Cti.. /c.,o~e/' / ~S Y S~„I4f~. ~¢ruD~rtJorv E~ 1'A~ckS ~ ~~~3 - N• ~"."r1' ~ i /,~l~ra,~.,Jt~ur-4 h~ Heettheare Int6rmation is pereonet ~md sen~Itive inlhtmatloo. It ie being liaced to you after app~npriata enthor~ica flnm t>ae patient a under cire~oooes flat do not e+equhv pademt authorimtim. You. the recipient, are obligated m mainlsin it is s aafty seeu% and ooolfdan`al mam~ar. Rediscloeure without additlo~] path+nt conatnt ar as permitecd by law is proln'bited. UnavtboriZed rv~discloenro or ibiha~e to '~~° ~tY could ~~ Y~ ~ P to fbdarnl and state taw. The iaon ooniatined in this lite+eimiler nx'aes8e 1a pfirate. conLtdeatiai. and privileged information and is indendad aaly for the use ofthe individual or per.oo(a) Warned on ibis teaoeo»esion sheet. Ifyai receive this maseaga in error, pkaaa notilSr otrr ofltasmtaediateiy by teteplane sa we can make +~rraaga~meDts for the reatra of the vrigiml doaaaenu. EXHIBIT `C' Bruce J. Warshawsky From: Bruce J. Warshawsky Sent: Wednesday, February 25, 2009 9:16 AM To: Heather D. Royer (E-mail) Cc: Bruce J. Warshawsky. Subject: draft of release in Word per your request is attached Importance: High releaseflnal.doc Bruce J. Warshawsky, Esq. Cunningham 8 Chernicoff, P.C. 2320 N. Second St. Harrisburg, PA 17110 717-238-8570 717-238-4809 (Fax) CONFIDENTIALITY NOTICE: This email contains information from the law firm of Cunningham & Chernicoff, P.C., which is confidential and/or legally privileged. If you are not the intended recipient, you are notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Please notify us immediately if you receive this transmission in error. Thank you. Tracking: Recipient Rsad Heather D. Royer (E-mail) Bruce J. Warshawsky Read: 2/25/2009 9:17 AM CONFIDENTIAL SETTLEMENT AGREEMENT AND MUTUAL RELEASE This is a Confidential Settlement Agreement and Mutual Release ("Agreement") by and between Leo Farrell, M.D. and Farrell Plastic Surgery and Laser Center, P.C. (hereinafter referred to as "Dr. Farrell") and Peter J. Sakol, M.D. and Peter J. Sakol, M.D., LLC (hereinafter referred to as "Dr. Sakol"). WHEREAS, Dr. Farrell and Dr. Sakol were engaged in a cost and revenue sharing relationship for their respective medical practices; (the "Relationship") which was severed when Dr. Sakol moved his practice at the close of business on January 23, 2009; and WHEREAS, Dr. Farrell claims that Dr. Sakol owes Dr. Farrell money in connection with the Relationship and various issues have arisen during the Relationship and since its termination that has created a dispute by and between Dr Farrell and Dr. Sakol (the "Dispute"); WHEREAS, the parties hereto, desiring to avoid the expense of litigation, have agreed to resolve the Dispute and all matters arising out of the Relationship. NOW, THEREFORE, for the consideration contained herein, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: 1. Consideration Dr. Sakol agrees to pay and Dr. Farrell agrees to receive, Eleven Thousand Four Hundred Ninety-Four and Ninety-Seven Cents ($11,494.97) in full settlement of the Dispute and all matters and disputes arising out of the Relationship. 2. Complete Mutual Release a. This Agreement provides for a Release which includes, but is not limited to, all claims which were or could have been brought in connection with the Relationship. b. Dr. Farrell, for itself, its affiliated and related companies, officers, directors, insurers, successors, and assigns, hereby agrees to forever waive, release, and dischazge Dr. Sakol from any and all claims, causes of action, and lawsuits, including but not limited to any claim that Dr. Farrell could have asserted arising out of the Relationship, of any type whatsoever arising prior to the time of execution of this Agreement, whether known or unknown; and all rights and duties, obligations, debts, liabilities, damages, injuries, expenses, actions or causes of action and suits of every kind and nature, contingent or actual, liquidated or unliquidated, in connection with the Relationship, provided, however, that nothing herein shall be construed to release any obligations or undertakings pursuant to this Agreement. c. Dr. Sakol, for itself, its affiliated and related companies, its officers, and directors, insurers, successors, and assigns, hereby agree to forever waive, release, and dischazge Dr. Fazrell from any and all claims, causes of action, and lawsuits, including but not limited to any claims that they could have asserted arising out of the Relationship, of any type whatsoever arising prior to the time of execution of this Agreement; and all rights and duties, obligations, debts, liabilities, damages, injuries, expenses, actions or causes of action and suits of every kind and nature, contingent or actual, liquidated or unliquidated, in connection with the Relationship; provided, however, that nothing herein shall be construed to release any obligations or undertakings pursuant to this Agreement. 3. No Admission of Liability The parties, and each of them, agree that this Agreement is made in compromise of disputed claims and to avoid the expense and inconvenience of litigation and is not, and is not to be construed as, a finding or admission of wrongdoing, or illegal, immoral or unethical conduct by any party. 4. Confidentiality and Non-Disparagement a. Dr. Farrell and its counsel and Dr. Sakol and its counsel (i) state that since February 18, 2009 and (ii) henceforth they agree they shall keep strictly confidential, and shall not reveal, publish, communicate or otherwise disseminate to any other person or entity, the existence, terms and conditions of this Confidential Settlement Agreement and Mutual Release including without limitation, any and all matters relative to the Relationship, except as required by law or as required by any insurance company requirement with respect to billing and claims only, or the amount of the payment to be made to Dr. Farrell, except that Dr. Sakol shall not be precluded from communicating the amount of the payment to any federal, state or local taxing authorities or to any tax accountant or tax prepazer, provided that such accountant or prepazer agrees to keep such information confidential, except called with respect to such taxing authorities. b. Neither Party shall publicly or privately dispazage the other or make or publish any statement (orally or in writing) to any person or entity which would libel, slander, dispazage or defame the goodwill or the reputation of the other (whether or not such dispazagement legally constitutes libel or slander). c. The Parties recognize that irreparable injury will result in the event of any breach or threatened breach of this Confidentiality and Non- Disparagement Provision; therefore, they agree that in addition to any _ __ monetary damages or other remedies available, at law, the non breaching party shall be entitled to equitable relief in the form of a temporary restraining order, a temporary or permanent injunction to restrain the threatened violation or actual violation of this provision together with the reasonable attorney fees and costs incurred by the non-breaching party in the successful enforcement of this Confidentiality and Non-Disparagement Provision. In the event the party which is alleged to have breached this Confidentiality and Non-Disparagement Provision successfully defends such an allegation, that party shall be entitled to recover its reasonable attorney fees and costs incurred. 5. Choice of Law. The parties agree that this Confidential Settlement Agreement and Mutual Release shall be governed by, and construed pursuant to the substantive laws of Pennsylvania, and shall be exclusively enforced by the courts of the Commonwealth of Pennsylvania with exclusive venue in Cumberland County, Pennsylvania. 6. Agreement Freely and Voluntarily Entered Into a. Dr. Farrell hereby warrants that it has signed this Agreement only after review and consultation with its counsel, Heather Royer, Esquire, who has represented it, that counsel has explained the terms of this Agreement, it has had a reasonable time within which to consider the settlement, and that it understands this Agreement and signs it freely, knowingly and voluntarily, without any legal reservation, duress, coercion or undue influence, and fully intending to be legally bound hereby. b. Dr. Sakol hereby warrants that it has signed this Agreement only after review and consultation with its counsel, Bruce J. Warshawsky, Esquire, who has represented it, that counsel has explained the terms of this Agreement, it has had a reasonable time within which to consider the settlement, and that it understands this Agreement and signs it freely, knowingly and voluntarily, without any legal reservation, duress, coercion or undue influence, and fully intending to be legally bound hereby. 7. Complete Agreement This Confidential Settlement Agreement and Mutual Release embodies the full, entire and sole agreement of the parties hereto and that regardless of the adequacy or inadequacy of the amount paid, it is intended to avoid litigation and to be final and complete. No modifications to this Confidential Settlement Agreement and Mutual Release shall be of any force or effect unless in writing and signed by the parties to this Agreement. IN WITNESS WHEREOF, INTENDING TO BE LEGALLY BOUND HEREBY, THE PARTIES BELOW HAVE EXECUTED THIS CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE AS OF THE DATES SET FORTH BELOW: Witness LEO FARRELL, M.D. Dated: , 2009 Dated: , 2009 Witness FARRELL PLASTIC SURGERY AND LASER CENTER, P.C. Dated: , 2009 Dated: _ , 2009 IN WITNESS WHEREOF, INTENDING TO BE LEGALLY BOUND HEREBY, THE PARTIES BELOW HAVE EXECUTED THIS CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE AS OF THE DATES SET FORTH BELOW: Witness: PETER J. SAKOL, M.D. By: Dated: , 2009 Dated: , 2009 Witness: PETER J. SAKOL, M.D., LLC By: Dated: , 2009 Dated: , 2009 F:~liomelHJW1DOCSISAKOL.PETER1General Businesslreleasefinal.wpd EXHIBIT `D' Bruce J. Warshawsky From: Bruce J. Warshawsky Sent: Tuesday, February 24, 2009 10:27 AM To: Heather D. Royer (E-mail) Cc: Peter Sakol (E-mail); Bruce J. Warshawsky Subject: update Heather. I know you just met with Dr. Farrell yesterday and want to update you on a few matters. He wants the situation resolved with a payment by Monday and I have the $$ in escrow if we can get it done. Apparently, his website needs to be revised to remove references to Dr. Sakol. We can give him a reasonable period of time to do it under the agreement, maybe a week, and if he starts the process now, it is achievable. Another incident occurred yesterday when a patient inadvertently went to Dr. Farrell's ofc for an appt. w/Dr. Sakol. The woman in front was rude and told the patient that she had no idea where Dr. Sakol could be found. The Rx issue should be resolved. Dr. Sakol has his own pads and has been using them, but there are still some old scrips out there and pharmacists haven't caught the change, so out of force of habit, they are making the mistakes. We are doing our best to correct the situation. Also, the Patriot ad snafu was unfortunate, but entirely not Dr. Sakol's fault. Again, we are taking corrective steps. We really need to do our best to get this business relationship severed neatly. Bruce J. Warshawsky, Esq. Cunningham 8 Chemicoff, P.C. 2320 N. Second St. Harrisburg, PA 17110 717-238-6570 717-238-4809 (Fax) CONFIDENTIALITY NOTICE: This email contains information from the law firm of Cunningham &c Chernicoff, P.C., which is confidential and/or legally privileged. If you are not the intended recipient, you are notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Please notify us immediately if you receive this transmission in error. Thank you. EXHIBIT `E' .. '' John W. Purcell, Jr., Esquire ID #29955 Purcell, Krug & Haller 1719 North Front Street Harrisburg, PA 17102 (717)234-4178 jpurcell®pkh.com FARRELL PLASTIC SURGERY & LASER CENTER, P.C., Plaintiff v. GAIL ERDMAN, Defendant IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA NO.09-7616 CIVIL TERM CIVIL ACTION -LAW DEFENDANT'S ANSWER TO COMPLAINT WITH NEW MATTER AND NOW, comes the Defendant, Gait Erdman, by her attorneys, Purcell, Krug ~ Haller, who file the following in answer to Plaintiffs Complaint: A. P rties 1. Admitted. 2. Admitted. B. Jurisdiction and Venue 3. Denied as a conclusion of law. 4. Denied as a conclusion of law. C. Factual Background 5. Admitted. In further reply, Defendant was employed by the Plaintiff for a longer period of time than that which is set forth herein. . ', 6. Denied as stated. To the contrary, as an office manager, Defendant was responsible to manage the staff and the office, who, in turn, were responsible for checking patients out after procedures, collecting payments from patients, and making daily deposits. Other employees were responsible for those matters. As office manager she was responsible for preparing accounting reports. However, as office manager, on occasion, she would assist staff with some of the other duties. 7. Admitted in part. Denied in part. It was admitted that at the end of the day, Defendant was required to prepare a payment report. It is denied that she was responsible for making deposits. 8. Denied. As office manager, Defendant believes she had the authority to give discounts in an effort to ensure timely payments from patients, as discounts were often granted to patients for various reasons, including the receipt of cash payments. Many patients paid in cash, with our without discount. 9. Denied. Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averments contained in this paragraph, and strict proof thereof (s demanded at trial. In further response, this allegation is also a conclusion of law. 10. Denied. The daily payment reports could not be altered. 11. Denied as a conclusion of law. The allegation contained in this paragraph is vague and over broad, and all the records are in the possession of the Plaintiff, so the Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averment, and strict proof thereof is demand at trial. 2 12. Denied as a conclusion of law. In further ropy, the Defendant did not intentionally and fraudulenty use her position as office manager to intentionally convert $54,434.97 from the Plaintiff for her own personal use. COUNTI Conversion 13. No response required. 14. Denied as a conclusion of law and as more fully set forth above. 15. Denied. Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averment, as the records are all in the possession of the Plaintiff. Strict proof thereof is demanded at trial. WHEREFORE, Defendant respectfully requests this Honorable Court to enter judgment in favor of the Defendant and dismiss the Complaint. COUNT II Frau 16. No response required. 17. Denied as conclusions of law. In further reply, Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averments, as all records are in the possession of the Plaintiff. Strict proof thereof is demanded at trial. 18. Denied. Defendant made no representations, and the matter is denied as i ~ conclusions of law. 19. Denied. Defendant made no representation, therefore, the matter is denied as conclusions of law. Z0. Denied as a conclusion of law. 3 21. Denied, Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averment, and strict proof thereof is demanded at trial. WHEREFORE, Defendant requests this honorable Court to enter judgment in favor of the Defendant and dismiss the Complaint. NEW MATTER 22. Defendant worked in the office of the Plaintiff for approximately 8 years. 23. During that time period, Defendant became aware that Dr. Farrell was perpetrating fraud upon various insurance companies, by representing that he was performing various procedures on patients when in fact others who were not accredited with the insurance companies to pertorm those procedures were actually performing them, primarily his wife. 24. At least on one occasion he requested that the Defendant participate in altering records in anticipation of an insurance audit. 25. Defendant refused to be a part of that, and instead other employees of his office were directed to make the alterations at his direction. 26. Defendant believes and therefore avers that Plaintiff is under investigation for insurance fraud, and that part of his motivation for making the claims set forth in his complaint are to affect the anticipated future testimony of the Defendant. 27. More than one employee of the Plaintiff had access to the books and records of the Plaintiff during the time period in question, including Dr. Farrell himself. 28. The facts giving rise to Plaintiffs complaint could have been caused by people other than the Defendant, including Dr. Farrell himself. 4 29. Plaintiffs claims are barred in whole or in part by the doctrine of unclean hands. 30. Plaintiff's claims are barred in whole or in part by the applicable statute of limitations and/or lathes. 31. Plaintiff has failed to state a cause of action against the Defendant. WHEREFORE, Defendant requests this honorable Court to enter judgment in favor of the Defendant and dismiss the Complaint. PURCELL, KRUG 8 HALLER ay: o n r r., Esquire 55 1719 North Front Street Harrisburg, PA 17102 (717) 234-4178 Attorney for Defendant DATE: J~ - / 7 - o ~' 5 VERIFICATION 1 verify. that the statements made in the foregoing axsw~.x TO cor~i~IxT WITH NEW MATTER are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C. S X4904 relating to unsworn falsecation to authorities. Date: I ~'1 ~ ~ ~ Oc( ~ ~ .~ , CERTIFICATE OF SERVICE I, Kimberly S. DeFalco, Legal Assistant to John W. Purcell, Jr., hereby certify that a true and correct copy of the foregoing document was served upon the Plaintiff, by sending a copy of the same via first class U.S. Mail to: Peter M. Good, Esquire Jessica E. Mercy. Esquire Smigel, Anderson 8 Sachs, LLP 4431 North Front Street Harrisburg, PA 17110-1778 Kimberly S. DeF co, egal Assistant to John W. Purcell, ., squire PURCELL, KRUG 8 HALLER I.D. No. 29955 DATE: `~, ~~ l ~~ ~ t , ' Y ^F THc P ;;()~ ~ t ~ ,~ •, ~~~ ~ OTARY 2009 OTC t 8 Pri 3~ 3 0 t ~, . r.4 i EXHIBIT `F' ~, ~. r . .r .. .' . ,:. The pai1~ t~::-t1ti18 pin 9rouP P' 2t~4,.Mecha~t~sbt Associate's, a ..•.4.,l~~ i.~/ r__ AccoutrtabiltlyAct ("H : ~iA~};: ~ ... ~.. _. • .. ^ Privacy Rule (a~Ikra Sta~st~Cis for f~riyacy ~ fndividuaHy-idetrti#fabt~ .:He~ith informaiaon) -This ruie~ ~s p~~ ~ ~.~'. Pat+t ~~4~4~1~ fiabhsttes st~rrdarda for,th~•pnvacy oi` pr 1 ~h~i~~,~f~~~i+ed=~>Wnr`is n~uir~ undbr ttie rule to. °'btis prhtary a~.~~rYca itl~errtiti~ to whidt~a ifi disalo~s'h~tth ir~tontratloti Pm'1~y`tti®. ri~'(`'~~ arit~/or ~it,.ai to ~ or receive PHt on its beila{f: r ,; ^ 'Trartsabtl~r~tand ~c ~ ~ rTh ~, , ..: ~~~~ ~f~b118h8d s-t.4g C t='R Par# 162.:.1# establishes da~~ ~~.~~,~irr o~.Qls atut:~oth~r fieal~- rice p...rwvwvr.v--t, .~.w.vc~MVVSw j}•+~iy!R~+~I;p~ix~"it7~,{Illi~'~r1,4t~Y14CM1~Yf~W"1I7C~TiJ1®W.'C8.(~FaI~O~ crertain entitles whiff duct Trarrssatioc~s an w~iole or part on its: b®half to,cx~mpiy with itiea Hale with resPe~ta~ ~rans~s ~d to r+aii{ttif~e'ai~eir ~ger~a and. subcor~'at~ors td. i~aly~Wa~e .rule w~i ~ ~ such. Trrar~sor~a. Th® Parties agree to ~ b'e lall~ ~-a' ta..t~ tune artd condemns set `for'th iii tltts Agreement: • i. i. Dattnitfons.° s :. .:. . "tndfiridual" ~he11 M~sve the sarr~ flhea~ " 4 `. the, temt. "ir~ctividc,a~' ih~ 45'C:F:R. §''164.501 and shalt. includea pe~soc- who quaiifiea as a personal repcesentative,in accordance witH 45 C:P l~.,§ 1i~:~}~ " . _ ~ . v <s r,~ but~a~ riot limlxed to professional ~1er'at' at~t'`~`E!I` (~$~,~ ~,, ,, .:~ ~' ~IE~IE~'.. licensing. regulations~~ foi• ~hy8 ctar~s (49'l~t. Code,§'16.81, §25.213); tie Gonfiaentiai'dy of H~/-Related tn~ocrnadon AcC" (35 P;S. §§'~~Q1=761'2); #te. FAen~I Healtft Ptoradures Act and ~reguiations (50 P:~. §71.1,1; 55-Pa`Cade _§510.p:31-51.00.39)} and the i`etleral pnrteCtions fior drug and' alcohol abuse treat~errt records" (42 U.S.C: 290dd-2; 42 C.F.R. §§2.1-2.67). "Rrivacy Buie" shall mean th±s Standards :for Prt+raGy of lndividuatly-iddntfftable Health lnformatiorf prom~algated.:by ths"i?epartrrie~t o~ Heald" and Human Services pursuant to the.Heatth Insurance Portab~tity end Acxouritabilit~irAct at 45 C.F.R. Part 164. .`+ "PHA" ahaN hav+~ the ~ ~i~1g`w~th~''fie~r~m "F~il" ire 45 G.F:R: §164:541, limned to the.in#onnation flr. t'ei~eived by Bu~ir~~s Assodats:f~o~ ©r:on~ behaif~ of ` Covered: ~ntit~:. ,. ~, ~ • :~,., "R~quic~ B~± Law" ahait~hav~r-.fhb same meehiilg'.~s the term :"requif+ed try law", in.45 ,. ~ ~;R § 1~4 501 ;_ . . Sep' ~tfia~ ~iaao:tne B~cceta~y ~ thel~epafaY,ent of -kie~ti .and Muman $@IYi~@S.of 1`1i8.Of her~c#esigne~ .~ _... "'i'cansactiori" ~i~-e~na a:.I~t~sactiar~aubjeaEto the:'fra4asact~on and Cade set Rule. . "Transactions anei Code Set Rule" ehali min the T~ns,~tions,and Code Set= n~ler promul4s~d~ i?ti. the Dam of Iti~C1` ~uti~~t't ~eryics~:pu~nt to~ the: Health . lnsurarice Pvr#abllity and ~°tta~orYtb~Ilty~A~.et~~5 E:~:R.'F~art.'[E32. 8. Penhitfisd uses and: dfselosucee ', Btcslrle ./~soci.. by .:.... _ ,. wT 6e fQ[r..0[ ~ a~Oiz'~DY~T~"~~ ~i WOU~d nQd~,Vi0i~9' #1l~;6a 'huh `~-r'"~,_~ ~4'~l .. S:~SpecMs uses send: dlscl~eros.. _~;~ Business-Assod ~ F~t~rfi~rnc the proper n~gems~;ar~d~ adtr~i~"~~ ctf'tr in this. Agn3ement, ns.,activities,;or u88 tN dIBCIOSUF~ f~±~G:F.R: §.164,5ti4fe)(4)(i).for ~si~5e~'.Assoaa#e ar to: carry out D. Business~Ass~da#~ agre~ith e~ts~re ,~f ~.rt,~t~gerrtt in~iuding.a subcontractor, t© •w^ho'~m ~ pr~o{~i~d/~~sd~ f~'H~1jF r~.ere~ h, ±~~- t~r~~. ~~p~ !~}/~i/v~e~Qi.by;/~~~/u~~~i~/t{e~sj~~y AQdcyiate W 1 MY~aI~ i/,.VV~VlQV~i.a~~. ~1 r jij,.~~~ +,.'M.vNIMNy.q ~M tiVnMiUYn.7 t~l~a~~ly throU~h th~~plgt?9~@RlantVYi~I'1 t'~~1.8Ct~./tQ SUCf~`in~ol'1r18>~On E. Business Associ~~ ta,Rld~~, ax #te:request of .hovered :Bntity~ and in the tirrte;~rld. ~ , ~ tl~5'sr,i ` , ,~ ,, , Bnt~y'raiv Rr~ll rn a De i~nated ' ReCOnI Sat;(as.defiined'1~~f°~i~~~:~o ~t~iBnl~y>Qr, asdi~ec~ad bye Coven~d ErttiEy; to an.Indtvtduatin~ on#ec.to mee~the requirernents.under 45 C.F.R. §1H4:5?4. ~ ~ '. . E. B~iness~As~octefei ram tb rY ¢~ Y ~,i~.•,~ndmectt(s~ to _PHI in a-Designated x i pia '~1 .* 4 Record~.Set~:~att#~~ ~`;~:'i~#;:a~.agcto.pu~suaht'to45 C.F.R. §964.5213 at the~reques# of Cev+ared or, an,lndi~idual; and n the time and manner desi~~tated 6~-~ratl ~nt~tji~ ' ... .. .: ~t ,~ a.Busineas AsscPclat~ agt'td t`aelcb i~ntemal proms; books;.,and=recorria- relating to the use and dlecl~ure'ofi i?Hf'ei~-ed fi'orn; or created or r~ec:eived by Business Associate on behalf ofi~ ~oV,±~r~ ~X.avaitableK toahe Cor+erect entity, or at.thd`request cry the~4o tits td,~ raetary ~., , ~ r ~ , ~n;a#~cne and.manner designated last the~~C:r~ered ~ 4~' ~ry, ~r purposes ofahe Secretary da~termining Ccwer~d ti c~'plce yyi~t~le-:.~~acy Rule:: H. Business Associate agrees to'nta relating t8 the' use. and: dfsctt>~ure:: of Business A~s$odate on :bexiaif: v~f Co time.and~ t~tanrlgr de~i~nstteed'ltt practices,.bQOks;::and~ rsico~s ed :fo~m, or rrestQd or- received ray . ~t;.av~ileblg iroaha Covered Entity, in a /. ' PuR~~ of Covered. Entity ., t. Business A~so~iath n`fio da~die~l~su~tt disc~asuras•of PH1 and`irtformation related•to sudi>dis+clost~i~t a~:wo~I~l~~ulr~t~far CaveL E,~tity to respond to a request by an Individpal~fot art a~ourt~ing'of`_dfsdosares of: PHI in accordance with 45 C.l"..R. § "t64.528:. • J. Business.A~ agrees:to provide..a~•;Coveted.l=ntiiy or an Indi~idwal,. in time and manner designated. by Covered' ~atitY, .iio f't~l~ in a Designated .Record Set. to ~i u ~ ~ Ki.. . Covered Entify, or as dir±ec#ed: ~'~ G~Yerad. ~n$ty, ao respond: ~ a regwest by an. Indlaidua~l for act:ac.~oun$tyg. of ai~~losure$ .off ~Hi ark ac~coEdanc~ with 45 C>h:R §164:52$: K. Noivvitlastanding any., gthe~ iz~ ' ,in 1~ Ag~e,~+er~t,. Bu~~rrQSS~:assocsafieaiaii c'or~np{y: wr't~'tier ~ crud `f1e ~~ h~~ tFie extent Matthey ~~ ~. pra-empfibd: by ~ Pt`1v~ f~~ att'i~l sib r~ofi e~-gageart any acfivity thatwuuld result in Cov~ered~Entity;befirig:m viot~tioa Qf br~y~ot{~Aprst~##e or fedeeal prlvac~ law: L If Business E~lssoclata conduotS a: Tt`at~sao~o~ in whole or part for or on behalf of Covered; Entity, Business Asbrgciaba4 ~~ha11 J;yr vji~t all ~Rplic~~ requits:of t~ Tran~rtions: and Cede ~t11~`c~ .r$tir~e at3Y a ;or suboontrac~or to corrtiply~witia~ait applitakllb uiih~s',~Transac~4ns~ and~~Code~Se~ Ruie. 1Y. ObUga~ons of Cove~r~ Efi~#lfy° . . a. Covered Entity:shetl'~prov~d& ~i~ini y ~~ ~ the rtt~Ca:.pf privaoy Pras.ahat~Covere~4 ~ pu''b~ a~ ;with.45 C.F.R. § :'f64520, as weft .as..any char t~ b~rcT~°.1~t '` , : , B.?Cc-vered E~ttityshalGprov~db 6usir~es~ ~$ociate with any-changes in, or revocation of; permission b'dt a~ indt~ida~ ~o, ~..~r..d~dobePHl fauch changes aft~acC Busirfeas ~tssC~i~rte'8>pf +~~ u~ , and disclosures:. C. CGwered En#ily sMaU `nq`bfy~`~c~it~'s ~i~ ~: any restri~on-to thb, uae.-or disclosure of ~PHi.that Cove~+d'Etrtfity. ham`. ~ in :acco~dence with 45 C.F.R. §164.522, ff the res#tiction aft ~usisAste'a pe~mit#~d;~or required usbs and •d'~tosures. . .I •rMf Y.~'TN'.~hal .I i _ ::'l^,f-.. ~.. •S•k 1. !__. . I~ric manner.#ha~:wouid nc~'~e the e,~; use or di~dose PHi ire any py ~ute~if. dtitle ley Covered i~..~~niinlstratira~ activities of V.. Terra: anal Terntiiratit-n - ~ ~ . a A. Term: The Tenn of~fti~ % f e~a~ 6~ -e a$ ;af ~~ / ~ D ,~ .and shall brrrrlr~a~ wheh eti o~~the t~~(i bbd ~oversd: ~f .~ Entity to:Bwsiness ~. ~ ,k ,._ ~ssociabe,. or:cxaated br~~ ~;~ ~ . ~~ss ie-ssodate on.isehalf of Covered Entityr, is dest~yed or retur~e~d to Cover~¢ , ar, ,ii` ~ ~ ;infi~asif~le to rbtum or des#roy::Prote~eC( Haaitlf lhf0't~na~tin, }~ „ , i~8 ec+s .!nd~ to~ such information, in arcordanre with the tartni"tiatior3-pcb~Ontl,F~t ths~~Set~ion~Y: .., .. .. .. : . + ~ ~ i B.. Tertnin~ttlon toc irause. ~ ~ . ,,. i~ ;ate . . '~: (~~~~ F,~ti~i' fit'~1.t~t'g~~.;~'1~'-t~i'~i~~.~n c~r.~tQrmi~.~h~fi R~ irrirnediateiy ~at~ ttlis; A~ree~ne~t provid®~ Business A~ssocs vv~- a~ with ~n.~t.°B 2. frr ~t~te `+e~f: #~ provleictns ofaerf ~ ir~~i~IN Sf: "~ be~n,~n't~ :Cot~erQC~:Entity may ever (ij .arty., offer related agr+aements o~ (ii) ~- to care the.: brBat~h~ in'abicordance ce1 pu~u~nt to twos section, ~a 2. L~pportur~tty. to cyra :option.; red..Ent[wy, mad elec,~ ao notify, Business Associate of'a rrtatariei breach ~r.1~~r~~de>Rusin~s ~1,~ssq~iatEiw'.w~haha . opportunity #o cxtnep=t~rt~ ~ ` ~~ f~ , " ~$sfaoto terms: Provided ~:. hanNever, in the event that the Pat#iee do not .area to m~ustlty.~ s~sillctory terms vritkiin.,~ dais; Business A,s$o~awe:shaN cwt the. breech to tile, satisfaction of ,. tl~e eo~re~ed ~E v~itl'rif~ • days Bt~s1ness;~~~s failure ao curie :a breach as set forth in fhri~ su on is;grounii~ forth®imnYediate terrriirtr~fioM Af this , Agreement, encl any: otT~r'ftel agreerrii3t~s:: - ., C: Effact.of .~'e>'ryr(t~atl~on . .: . 1. Return or Dee~lon :o~'E~iai~; F~xcepi ei;":~rovi~iea iii .~ec~on VC.2~ u n t+sr~ninat[ort.of;ftiis ~i~eiment, fof any st~r~;. Bustneaa l~ssbciate shall ratGm Qr destroy, aA PHl r-ed fnorn +Covered,; i~ntitiy. or ~a#ed'ar rec~eirred by Business AssooiateR on befiaif.oftreredErit.'i~fis;'provis,jon ltiaN apPl~to PHi~#hat is in the possession of subco~tra~torr-' ar.ea~rits Qf Business Asspdate~. Business Associate shall retairt~ no copies of fie~`E~Hi:. ~. Return. or: Desti'uctlon.::In~eastika.: in the event that Business Associate determines that r+e~unling or d~~1~a~ PMi ~a ittfieasit~la, Business Associate shall provkie to Covered ~rdily notl~ca#lowi of the: cQndidons tftat make return or destruc~on infeasible:: Upon mutual agt of 1fte~ PbcHHes i~at. return or desixuction.of PHl is infeas~le; Buisiis:As$oc~ate shall~sxtiend the protections of this Agreement to suds PWl and` limit.fuitl`ier uses and. disclosures of such PHl to those~•purposes.that. make tle~.retum flr destruction infeasible, for so long as Business. Assodate mi~intains: such i'Hl. Vi. NllsceNaneous. A. Rs~ufatiory Rsfiererncea..A.refer±artce~in this;A®r~mentto a sectlon in the Privacy. Rule means the section as ir1 `effect: or as amended, and #ar which compliance is;regtJired: . B'. Intsrprstation. Any,ambiB.uity: inthis: Agreement shall be resolved in a favor of a meaningthat petrriits Covered`~ntfty to cotnpiy witl} they privacy-:Rule. ~ , _~,, C. Am~ndmi~t.. They Perges: agree tp;takssuch: aatior- as.is. necessary:. to amend this AQceemeM from erne ~~e ~a~ istie~ryr~x:Co~rera~ i- fia~bc~Pty witl'- .the,-t±hq~i~rr~~~ o~ ~~ ~e t #~, ki~tfh [~swranc~e PorC~abii~y and. Acxxair~t~bihl~A~ `P~ibhc R>i 'F-=1.#~fi ._ x;.; :, .::r: ; D~ ~~urvivel. 'Tti~® 'roc"~i~l;"~k~~~bli~p~~ ~~~usil~ssd~iate ti~~d,sr Sea6o~~V.C ofi't~iis 4~l~~rti~if~Il ~~ir~.~h®,#~rmir~a~bn: cuff ttis Agr~errient ,. <. .. , :. ;: :. ... ~.. ~ , F. ' PETER .!. ~SAtC~: dID~~,f~C. ; ." 1~~~II+tS~ /k~S.i~C. ~J4T~. . . ,: :_, By . ~, ' } . Print Name, ~,~ , " _. ~:.~: ~ ' . .:. Prig Nacre. /1 Print Tide: ~~ . Print Title; ~ "" Date: ~/ /~~ ____.____ ,.. - Rate. .~ ~_~~ ~ . ~: ~. :. .,,. :.. - a~, .. . ~: ` - EXHIBIT `G' i ~~ ~~ Leo D. Farnll, M.D. Suite 204, 2025 Tecb~rology Parkrorty Dcborab M. Fa~scll, M.D. Mecbaniaburg, PA 17050-9497 (717J 732-9000 fax (717) 732-9011 Dear Friend: We are contacting you to make you aware of our amazing technology. Our Candela Vbeam Perfecta Laser is the gold standard for treatment of vascular skin conditions, such as Rosacea. It is a pulsed dye laser which has a 20-year proven tract record of safety, reliability, and ei~icacy for treatment of a wide range of vascular skin conditions. We are Central Pennsylvania's most extensive on-site laser center with over ten laser and light based technologies. We offer state of the art laser treatment for numerous skin conditions including: ~ Diffuse Redness • Red Spots • Rosacea • Skin rejuvenation • Wrinkles • Port wine stains • Facial spider veins • Hemangiomas • Freckles • Pigmentation • Laser hair removal • Tattoo removal • Age spots • Acne • Leg Spider veins You can choose the laser treatment that is ideal for you! Please call Farrell Laser and Cosmetic Medicine Center at 732-9000 to schedule your consultation and treatment. *** All treatments are performed by a physician. *** urrvzn. fr~rneu~rd com /»~• ~,r 4~.~ RL'I ~.+. ~~ti' .- W ~~ y ~r _. _- :~.. ~~ H a H a 3• ~ ~ N H a~ ... V r,~ Q~s ~O ~b b V .~ ~• ~: J• ~~ ~ ~ ~,~ r~ .; . ,. _. ~~ EXHIBIT `H' 1 s JORDAN D. CUNNINGHAM ROBERT E. CHERMCOFF MARC W. WITZIG BRUCE J. WARSHAWSKY KELLY M. KNIGHT TRACY L. UPDIKE CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW P.O. BOX 60457 HARRISBURG, PENNSYLVANIA 17106-0457 TELEPHONE (717) 238-6570 FAX (717) 238-4809 HERSHEY TELEPHONE (717)534-2833 IRS N0.23-2274135 Street Address: 2320 N. 2nd Street Harrisburg, PA 17110 Writer's Direct Email: biwCa~cclawoacom September 3, 2009 HAND DELIVERY Heather D. Royer, Esquire Smigel, Anderson 8t Sacks LLP 4431 North Front Street Harrisburg, PA 17110 RE: Peter J. Sakol, M.D., LLC V. and Farrell Plastic Surgery and Laser Center, P.C. Cumberland County No: 09-6023 File No: 600409 Deaz Heather: Thank you for your voice mail and email of September 2, 2009. The BAA is terminated. The PHI (as defined in the BAA) must be destroyed. We aze prepared to litigate to enjoin and require your client to destroy my client's PHI. If your client destroys my client's PHI, we are prepazed to sign the Settlement Agreement (this statement is, of course, made for settlement purposes only and may not be used in any litigation), and all matters by and between our respective clients could be finally and fully resolved. At this juncture, we have filed suit and intend to address any and all claims against your client including, but not limited to, a Declazation Judgment Action on the BAA and a Declaration Heather D. Royer, Esquire September 3, 2009 Page 2 CUNNINGHAM & CHERNTCOFF, P.C. ATTORNEYS AT LAW Judgment Action on the oral business "relationship". I enclose herewith a Praecipe for Writ of Summons, Writ of Summons and Acceptance of Service. Please kindly return the Acceptance of Service at your earliest convenience. Thank you. BJW/ja Enclosure cc Peter Sakol. M.D. F:~EiomelBJW1DOCS~SAICOL.PETER\(3enerel BwineuU.090309.wpd Very truly yours, C GHAM & CHERIVICOFF, P.C. ~~ Bruce J. War wsky EXHIBTT `P JORDAN D. CUNMIVGHAM ROBERT E. CHERNICOFF MARC W. WTI"IIG BRUCE J. WARSHAWSKY KELLY M. KNIGHT TRACY L. UPDIICE CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW P.O. BOX 60457 HARRISBURG, PENNSYLVANIA 17106-0457 TELEPHONE (717)238-6570 FAX (717) 238-4809 5epteraber 10, 2009 VIA FACSIMILE: (717) 234-3611 and REGULAR MAIL Heather D. Royer, Esquire Smigel, Anderson & Sacks LLP 4431 North Front Street Harrisburg, PA 1.7110 HERSHEY TELEPHONI (n7) 534-zsa~ IRS N0.232274135 Street Address: 2320 N. 2nd Street Harrisburg, PA 17110 Writer's Direct Email: biw(a~cclawoc.com RE: Peter J. 5ako1, M.D., LLC V, and Farrell Plastic Surgery and Laser Center, P.C. Cumberland County No: 09-6023 File No: 600409 Dear Heather: A rather disturbing development has occurred. Attached herewith, you will find a "targeted" mailing which your client sent to various individuals (on or about September 1, 2009 -see postmark). Certain of these individuals were my client's patients who previously received Rosacea treatments.' My client has confirmed with other patients (who have never received Rosacea treatments) that they never received such a mailing from your client. The only explanation for this situation is that your client, again, utilized my client's PHI (as such term is defined in the BAA) for an unlawful purpose. I will presume that you had no knowledge of this matter because your email to me dated September 2, 2009, emphatically states that your client "has and will continue to abide by his HIPPA obligations". ' The name on the envelope has been withheld to protect the privacy of the individual who provided Dr. Sakol with a copy of said mailing. Heather D. Royer, Esquire September 10, 2009 Page 2 CUNIVINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW My client has been advised that certain of the recipients of your client's targeted mailer , may file HIPPA Complaints. Again, I reiterate that the BAA is terminated and my client's PHI must be destroyed. At this juncture, my client no longer has any interest in executing the Settlement Agreement. Please kindly return the Acceptance of Service that was provided to you so that same may be filed with the Court. Very truly yours, BJW/ja Enclosure cc Peter Sakol. M.D. F:1Hana18JW\D~C31sAICOL.PETER\Genmal 8wineu\L091009.wpd GRAM 8c CHERNICOFF, P.C. .~ Bruce J. W wsky ~~ .~ N s '~1 ,. Q ~~ .~ ~: ~? ~• ~;' 1 Y .. ~ ~• R .~ L ice.,. ~ Pd c «~o `$.~. Lse D. Fnrrl~ M.D. Sir 204,102f Tkbsel~~ p~ury Ds6mnrb M. F~asirll,ll~D. M~ P,! 170f0-997 (71 ~ 732-9000 f~'(717I 732-9011 Dear Friend: We are contacting you to make you aware of our amazing technology. Our Candela V'beam Perfecta Laser is the gold standard for tireatimaat of vascular skin conditions, such as Rosacea. It is a pulsed dye laser which has a 20-year proven tract record of safety, reliability, aad ei~cacy for hutment of a wide range of vascular slda conditions. We are Central Pennsylvania's most extensive on-dte laser center with over ten laser and light based technologiBl. We offer state of the art laser pmt for mm~erous skin conditions including: • Dif~ise Redness • Red Spots • Rosacea • Skin rejuvenation • Wrinkles • Port wine stains • Facial spider veins • Hemaagiomas • Freckles • Pigmentation • Laser hair removal • Tattoo removal • Age spots • Acne • Leg Spider veins You can choose the laser treatment that b ideal for yonl Please call Farrell Laser and Cc Medicine Curter at 732-9000 to schedulo your consultation and treatment. *** All treatment are performed by a physician. *** mto~, jrsr~eu~rrdco~c EXHIBIT `J' w ~, Please Take Novice to Our New Address, Phone ~ Fu Numbers 'Va Uey p'orae Corporate Center 12700 VaA ~ureio .A-ve.l Eaglrvllle, PA 19403 Gomputvr Sorvtcos tnc.. ;,~~' To: Hrace 8ublect: Phone: )1'sz Ptione: 7'17•T,3$-48x9 Wob Sito: www.stfcomputor.com ri,eta: 10/20/09 Number of payee tnsludtn~ cwvcr aheeb Z Ih'pm: V1fii'! $ep0e'1~0 p~bnent: Customer Support CC: )Plsons: 610650-97'00 Fa: Pbosse: 3vp~ort F:uc: 610-650-9275 ^ Urrem ® Por your review D ~p1Y ASAP ^ Please commtat Sruce Warr>Nawsky, mere ~ a cop y of the o-maf l I rent to you. 'T>tanlcr, ~'~Gnes ,,eyfs~b Customer Sapp oet 14tgr STl Computer ~~vices, Ino T~~ ~ MAMA \f,'.7A 1pAw TEA w.~wwwww~w w.~. ww.~r +++~ -- ~-- ~* . Vince ~Espo~ From: Sint: to: SubJect: Bruce, Vince Paposito (Vseposito~sttcomputer.com] Friday. October 18, 2009 3:46 PM 'ajvr~oclawpo.oom' Dr Sakol Below is a description of the procedures that would need to be performed on tha database at DR. Farrelis's offtce in order to remove tt~e data that you wish to remove. The cost to do this should not exceed SZ500 baMng any unforeseen complications. Removal of Practice Data from the database present at Farrell Plastic Surgery. Dr Sakol was billtnil under Practice 2 Remove all >ilnanci sl data associated with Practice 2 (ie: tharges, payments, etc.) Remove ail Appoirtment data associated with Practice 2 Remove all Patient s demographics attached solely to Practice Z ~ (f a patient was also seen by practice 1, that patient's demographics and insurance data would remain intact. All reference flies ~ ie: insurance tables, procedures, diagnosis, etc) will remal~ intact in the database. Thanks, Vince Esposito Customer Support Manager 511 Computer Services, Inc. ZOO lal SEAS ilSZfldl[0~ I,LS 4LZ80Q90i9 YY3 90: ZO 800Z/OZ/Ot EXHIBIT `K' r ~ ~ • '~~ ~.Y• .:~''~'~ ~r •~. ~. ~.L ~ ~ • ., ~~` . 1 1 ~ ~ _ ' , •` ~ ~ :r.~::~,. . .t? ~ ~ ~ ~~ :~ t ~,~~~~~ ~~ ~-- ~ ~ ~. ~ r _ ~ ,~ `~ ~~~~ ~R.~ ~s '~ ~ ~ ~ R 4s'~' ~~:~ g. fi. tt ' ~ T ^~ ~"7 a a Illlil f .• ~ VERIFICATION I, Peter J. Sakol, on behalf of Peter J. Sakol, M.D., LLC, verify that the statements made in the foregoing ANSWER WITH NEW MATTER TO COMPLAINT are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C.S. §4904, relating to unsworn falsification to authorities. By. Peter J. Sakol Its: Member Date: a ' ~~ .2010 .. ~, CERTIFICATE OF SERVICE I, Julieanne Ametrano, Legal Assistant with the law firm of Cunningham & Chernicoff, P.C., certify that a true and correct copy of the ANSWER WITH NEW MATTER TO COMPLAINT will be served by electronic means and/or by first class United States Mail on the following parties indicated: Peter M. Good, Esquire Darryl J. Liguori, Esquire Smigel, Anderson & Sacks, LLP River Chase Office Center 4431 North Front Street Third Floor Harrisburg, PA 17110 By: Ametrano 2320 North Second Street Harrisburg, PA 17110 Date: February 3, 2010 F:\Home\BJW\DOCS\SAKOL.PETER\Farrell v. Sakol\Answer with New Matter.122309.wpd -30- "~(- g` 1 u '4.. [. ,,qY .~ ~~~ ;_~ Bruce J. Warshawsky, Esquire PA Supreme Court ID #58799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second Street Harrisburg, PA 17110 Mailing Address: P.O. Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 Attornevs for Movant/Defendant FARRELL PLASTIC SURGERY AND IN THE COURT OF COMMON PLEAS LASER CENTER, P.C., DAUPHIN COUNTY, PENNSYLVANIA Respondent/Plaintiff v. PETER J. SAKOL, M.D., LLC, Movant/Defendant N0:2009-CV-15556-CV CIVIL ACTION -LAW JURY TRIAL DEMANDED MOTION FOR COORDINATION OF ACTIONS IN DIFFERENT COUNTIES PURSUANT TO Pa. R. Civ. P. §213.1 AND NOW, comes the Movant/Defendant, Peter J. Sakol, M.D., LLC ("Movant/Defendant" or "Sakol") by and through its counsel, Bruce J. Warshawsky, Esquire and Cunningham & Chernicoff, P.C. to file this Motion for Coordination of Actions in Difference Counties pursuant to Pa. R. Civ. P. §213.1 (the "Coordination Motion") and in support thereof moves as follows: This Coordination Motion is governed under Pennsylvania Rule of Civil Procedure 213.1. 2. A Hearing is necessary to the resolution of the Coordination Motion. 3. Movant/Defendant respectfully requests an oral argument on the Coordination Motion which should last no more than thirty (30) minutes. 4. Movant/Defendant, through counsel, certifies that he has sought concurrence from Respondent/Plaintiff scounsel by providing Respondent/Plaintiff s counsel with a copy of the Concurrence Motion on February 3, 2010 and the attached proposed Order (two (2) days ago). Respondent/Plaintiff s counsel does not concur in the Coordination Motion as presented and will file an Answer to this Coordination Motion. However, Respondent/Plaintiff's counsel agrees that Coordination is appropriate but to the extent that an order of Coordination shall be issued, Respondent/Plaintiff's position that the Coordination be in Dauphin County, not Cumberland County. In the interim, Respondent/Plaintiff s counsel concurs in the Movant/Defendant's request for a Stay to be imposed while this Coordination Motion is pending, in the form of the Order attached hereto. 6. Farrell Plastic Surgery and Laser Center, P.C. is the Respondent/Plaintiff (hereinafter the "Respondent/Plaintiff' or "Farrell") in an action which was commenced by Sakol by Writ of Summons in the Court of Common Pleas of Cumberland County on September 3, 2009 (the "Cumberland County Lawsuit") 7. There are no other parties to either this action or the Cumberland County Lawsuit. -2- 8. The Complaint in the Instant Lawsuit was filed by Farrell on November 18, 2009, so this Honorable Court is the Court in which a Complaint was first filed and is the proper Court in which the Coordination Motion must be filed. 9. This action and the Cumberland County Lawsuit involve common questions of law or fact and/or matters which arise from the same transaction or occurrence, as is set forth below. 10. On February 3, 2010, Sakol filed a Complaint in the Cumberland County Lawsuit, a true and correct copy of which is attached hereto as Exhibit "A". 11. Sakol also filed an Answer with New Matter in the Instant action on February 3, 2010. 12. The common questions of law or fact and/or the matters which arise from the same transaction or occurrence by and between Sakol and Farrell include, but are not limited to the following: a. Sakol and Farrell had a business relationship which was governed by, inter alia, an Oral Agreement (as such term is defined in this action in this case and in the Cumberland County Lawsuit). b. Farrell claims Sakol owes it a sum of money under the Oral Agreement, following its termination in January, 2009. c. Sakol has pled facts to support certain defenses to Farrell's claim for monies owed in this case and which the identical facts also serve as support for certain of the affirmative claims Sakol has pled in the Cumberland County Lawsuit. -3- d. Both this action and Cumberland County Lawsuit relate to the business relationship by and between the same parties and the effect of the termination of that business relationship. 13. It is appropriate for this Honorable Court to order coordination of this action and the Cumberland County Lawsuit in Cumberland County for the following reasons: a. The parties in this case have principal offices in Cumberland County. The only connection to Dauphin County is that Sakol's Pennsylvania registered address is located in Dauphin County (his home address); b. Sakol has requested injunctive relief in the Cumberland County Lawsuit, over which the Cumberland County Court of Common Pleas would have appropriate jurisdiction; c. The common questions of law and fact identified above are predominating and significant to both this action and the Cumberland County Lawsuit; d. Both Farrell's counsel and Sakol's counsel practice in central Pennsylvania and it is equally convenient for the cases to be coordinated in either County; e. Farrell resides in Cumberland County and many, if not, most of the witnesses reside in Cumberland County and all of them (those of whom are employed by either Farrell or Sakol) are employed in Cumberland County; £ If the Coordination Motion is granted and the matter moves ahead in Cumberland County, there will be no unreasonable delay or expense to any -4- party nor will any party be otherwise prejudiced; g. A determination of the respective rights and obligations of the parties in this case require coordination to avoid duplicative and inconsistent rulings, orders or judgments; h. Granting the Coordination Motion will promote the efficient utilization of judicial facilities and personnel and the just and efficient conduct of the actions as coordinated; i. While settlement has been discussed by and between the parties and the parties have, in compliance with Dauphin County Local Rules, considered good faith mediation (at Sakol's request which was rejected by Farrell), settlement negotiations have broken down due to Farrell's insistence to isolate his request for payment without regard for the claims raised by Sakol in the Cumberland County Lawsuit. Therefore, granting this Coordination Motion will increase the likelihood of settlement and conversely, should coordination be denied, the prospects for settlement are virtually non-existent, since Farrell has rejected Sakol's request to participate in mediation; In the Cumberland County Lawsuit, Sakol has requested relief for, inter alia, the destruction of certain PHI (as defined in the Cumberland County Lawsuit) which may affect a criminal prosecution involving Farrell's former Office Manager, Gail Erdman ("Ms. Erdman") for allegations that Ms. Erdman misappropriated monies from Farrell during the period when -5- Sakol's and Farrell's business relationship was in effect. Any injunctive relief will require the participation of the Cumberland County District Attorney's Office in connection therewith; k. Additionally, Farrell has sued Ms. Erdman in a Cumberland County civil action for the same alleged criminal conduct. Ms. Erdman's conduct, generally, and Farrell's supervision and control, or lack thereof over Ms. Erdman, directly impacts three (3) of Sakol's causes against Farrell in the Cumberland County Lawsuit; 1. Sakol also requests that while the Coordination Motion is pending, this Honorable Court issue a Stay of Proceedings in this case and in the Cumberland County Lawsuit. The Court is authorized to issue such a Stay pursuant to Pa. R. Civ. P. §213.1(b). 14. Sakol is prepared to pay the Court costs, if any, of the coordination to Cumberland County. -6- WHEREFORE, the Movant/Defendant, Peter J. Sakol, M.D., LLC respectfully requests that this Honorable Court grant the Coordination Motion and order coordination of this action with the action docketed to 09-6023 in the Court of Common Pleas of Cumberland County, Pennsylvania entitled Peter J. Sakol, M.D., LLC v. Farrell Plastic Surgery and Laser Center, P.C. and issue other appropriate orders consistent with and pursuant to the Pennsylvania Rule of Civil Procedure 213.1. C By Bruce J. Warshawsky, Es re PA Supreme Court ID# 799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second. Street Harrisburg, PA 17110 Telephone: (717) 238-8187 Attorneys for Movant/Defendant Date: February 5, 2010 -~- PETER J. SAKOL, M.D., LLC, .. IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA ~• NO: 09-6023 FARRELL PLASTIC SURGERY AND JURY TRIAL DEMANDED ~ LASER CENTER, P.C., ._ ~ m Defendant ,~ ~ to NOTICE TO PLEAD TO: Farrell Plastic Surgery and Laser Center, P.C. ~+' c% Peter M. Good, Esquire and Heather D. Royer, Esquire Smigel, Anderson & Sacks LLP 4431 North Front Street Harrisburg, PA 17110 YOU HAVE BEEN SUED IN COURT. IF YOU WISH TO DEFEND AGAINST THE CLAIMS SET FORTH IN THE FOLLOWING PAGES, YOU MUST TAKE ACTION WITHIN TWENTY (20) DAYS AFTER THIS COMPLAINT AND NOTICE ARE SERVED, BY ENTERING A WRITTEN APPEARANCE PERSONALLY OR BY AN ATTORNEY AND FILING IN WRITING WITH THE COURT YOUR DEFENSES OR OBJECTIONS TO THE CLAIMS SET FORTH AGAINST YOU. YOU ARE WARNED THAT IF YOU FAIL TO DO SO THE CASE MAY PROCEED WITHOUT YOU AND A JUDGMENT MAY BE ENTERED AGAINST YOU BY THE COURT WITHOUT FURTHER NOTICE FOR ANY MONEY CLAIMED IN THE COMPLAINT OR FOR ANY OTHER CLAIM OR RELIEF REQUESTED BY THE PLAINTIFF. YOU MAY LOSE MONEY OR PROPERTY OR OTHER RIGHTS IMPORTANT TO YOU. ~. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO THE TELEPHONE OR THE OFFICE SET FORTH BELOW TO FIND OUT WHERE YOU CAN GET LEGAL HELP. CUMBERLAND COUNTY BAR ASSOCIATION 32 SOUTH BEDFORD STREET CARLISLE, PA 17013 1-800-990-9108 717-249-3166 C INGHAM & CHE ICOFF, P.C. By: Bruce arshaws Esquire PA Supreme Court ID No: 58799 2320 North Second Street Harrisburg, PA 17110 Date: February 3, 2010 -2- PETER J. SAKOL, M.D., LLC, 1N THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, Plaintiff PENNSYLVANIA v. NO: 09-6023 FARRELL PLASTIC SURGERY AND JURY TRIAL DEMANDED LASER CENTER, P.C., Defendant COMPLAINT AND NOW, this 3`d day of February, 2010, the Plaintiff, Peter J. Sakol, M.D., LLC ("Sakol"), by and through its counsel, Bruce J. Warshawsky, Esquire and Cunningham & Chernicoff, P.C., files the following Complaint and in support thereof avers as follows: PARTIES AND IDENTIFYING INFORMATION 1. Sakol is a Pennsylvania Limited Liability Company, formed on March 23, 2001, with a Pennsylvania registered address of 4212 Jonathan Lane, Harrisburg, Dauphin County, Pennsylvania 17110, and with its principal medical office located 2025 Technology Parkway, Suite 205, Mechanicsburg, Cumberland County, Pennsylvania 17050 (the "Sakol Location") 2. Peter J. Sakol, M.D. ("Dr. Sakol") is the sole member of Sakol. 3. Dr. Sakol is the only licensed Pennsylvania Physician employed by Sakol. 4. The Defendant, Farrell Plastic Surgery and Laser Center, P.C. ("Farrell"), is a Pennsylvania Professional Corporation, formed on June 17, 1991 with a Pennsylvania registered address of 890 Poplar Church Road, Medical Arts Building, Suite 205, Camp Hill, Cumberland County, Pennsylvania 17011 and with its principal medical office located at 2025 Technology Parkway, Suite 204, Mechanicsburg, Cumberland County, Pennsylvania 17050 (the "Farrell Practice Location"). 5. It is believed, and therefore averred, that Pennsylvania registered office for Farrell is the former location for Farrell's former medical office location (the "Prior Farrell Location"). 6. Leo D. Farrell, M.D. ("Dr. Leo Farrell"), a licensed Pennsylvania Physician and is the President and Treasurer of Farrell. 7. It is believed, and therefore averred, that Deborah M. Farrell, M.D. ("Dr. Deborah Farrell") is also employed by Farrell as a licensed Pennsylvania Physician and is its Corporate Secretary. 8. Dr. Sakol practices in the speciality of ophthalmology, specializing in ophthalmic plastic and reconstructive surgery and is Board Certified in ophthalmology by the American Board of Ophthalmology. 9. Upon information and belief, Dr. Leo Farrell practices in the speciality of plastic surgery and is Board Certified in plastic surgery by the American Board of Plastic Surgery'. Further, Dr. Leo Farrell was at all times relevant hereto credentialed with Health America, Health AmericalAdvantra, Capital Blue Cross (and their affiliates, Keystone Health Plan Central and Keystone Senior Blue) and Highmark to treat and bill their insureds as patients. 10. Upon information and belief, Dr. Deborah Farrell claims she practices in the speciality of laser and cosmetic medicine and who was previously Board Certified in Pediatrics by the American Board of Pediatrics but is no longer Board Certified in any specialty. Further, while Dr. Deborah Farrell has been employed by Farrell, prior to the termination of the Oral Agreement (defined herein) she has not been credentialed with Health America, Health ' As of the date of the filing of this Complaint, Dr. Leo Farrell is listed on the American Board of Plastic Surgery as "Retired", even though he continues to practice. -4- America/Advantra or Capital Blue Cross (and their aff liates, Keystone Health Plan Central and Keystone Senior Blue). Dr. Deborah Farrell is currently credentialed with Highmark as a pediatrician and not listed as a plastic surgeon or to perform cosmetic or laser procedures. THE BUSINESS RELATIONSHIP BETWEEN THE PARTIES 11. In approximately, March, 2001, Farrell and Sakol began a business relationship whereby their practices were operated independently of each other but under an oral agreement between Farrell and Sakol (the "Oral Agreement") at the Farrell Practice Location. The terms, conditions and specifics of the Oral Agreement were as follows: a. Farrell was the Tenant under a Lease with the Landlord (at the Farrell Practice Location) with Sakol operating without any rights of tenancy but as a licensee within the Farrell Location; b. Farrell paid for all the operating overhead2 and provided all the labor (Sakol had no others employees other than Dr. Sakol while Sakol was located at the Farrell Practice Location) to provide a variety of services to Sakol as follows: i. Billing; ii. Collection; iii. Office Management; iv. Accounts Receivable Management; and ` Except for Sakol's malpractice coverage, a portion of its direct advertising and Botox and other supplies as identified below. -5- v. Assistance in Medical Procedures. In connection therewith, Farrell had complete control over the aforementioned services3 to be provided Sakol including, but not limited to, the supervision of and that the methods by which billing and collection were handled, and the amount of time Farrell's Office Manager, Gail Erdman ("Ms. Erdman"), was permitted to devote to collection efforts on Sakol's behalf. While Sakol's practice was located at the Farrell Practice Location, Sakol owned its own medical equipment and had specified rooms for its practice for ophthalmology. Sakol was permitted to utilize Farrell's "minor procedure room" and some surgical equipment and lasers for various procedures; d. Sakol and Farrell shared a computerized billing system in which both Farrell and Sakol had access to the basic demographic information about Sakol patients and Farrell patients, limited to the names, addresses, dates of birth, social security numbers, identification of primary insurance carriers and any specific insurance company account numbers (the "Common Database"). Each practice, Sakol and Farrell, respectively maintained their own paper file and computerized medical and patient records and computerized billing system separate and distinct from each other's (the "Sakol Separate Database" and "Farrell Separate Database"), Except that Dr. Sakol, on behalf of Sakol, controlled his own time schedule. -6- although under the same computer hazdwaze and softwaze system and maintained by the same computer hazdwaze and softwaze vendor. Dr. Sakol only accessed the Sakol Sepazate Database and the Common Database, while Farrell, through its employees, had access to the Farrell Sepazate Database, the Sakol Sepazate Database and the Common Database, as required for the management of both medical practices; e. As remuneration for the licensed use of the Farrell Practice Location by Sakol, as well as the various services provided to Sakol by Farrell as set forth herein (collectively the "Farrell Services"), Sakol paid Farrell, under the Oral Agreement, fifty percent (50%) of each prior month's cash collections4 received by Sakol, which was calculated each month by Farrell (by Ms. Erdman) (the "Sakol Payment"); f. Both parties had a reasonable expectation that neither party would commit any fraud while the Oral Agreement was in effect that might possibly damage the other party; and g. The Oral Agreement was terminable at will by either Sakol or Farrell. 12. On or about April 10, 2003, the parties supplemented the Oral Agreement by entering into a Business Associate Agreement (the "BAA"), a true and correct copy of which is attached hereto as Exhibit "A". The BAA was executed by Dr. Sakol on behalf of Sakol and by ' The remuneration changed over the course of their relationship to "carve out" certain items from the total cash collections of the prior month from which the fifty percent (SO%) payment was made. These included Sakol's malpractice premiums, a portion of its direct advertising expenses and the amounts Sakol paid to Farrell for Botox and other supplies all of which were reductions from the amount against which this fifty percent (50%) payment would be calculated. -7- Ms. Erdman on behalf of Farrell as its Office Manager. THE TERMS AND EFFECT OF THE BUSINESS ASSOCIATE AGREEMENT 13. The BAA governed Farrell's use of the Sakol Sepazate Database. 14. The BAA also governed, inter alia, the rights and responsibilities of Farrell and Sakol under the Health Insurance Portability and Accountability Act ("HIPAA"). 15. The BAA incorporates by reference the definition of PHI (Private Health Information) set forth in HIPAA. 16. In the BAA, Sakol is identified as the "Covered Entity" and Farrell is identified as the "Business Associate". 17. The BAA provides, in pertinent pazt, the following: a. II. Permitted uses and disclosures by Business Associate. A. General uses and disclosures. Except as otherwise limited in this [BAA], Business Associate may use or disclose PHI to perform functions, activities or services for, or on behalf of, Covered Entity, provided that such use of disclosure would not violate the Privacy Rules. b. III. Obligations and Activities of Business Associate. *** A. Business Associate agrees to not use or further disclose PHI other than as permitted or required by the [BAA] or as Required By Law. *** K. Notwithstanding any other provision in this [BAA], Business ' Which is defined as the Standards for Privacy of Individually-Identifiable Health Information promulgated by the Department of Health and Human Services pursuant to HIPPA. -8- Associate shall comply with other state and federal privacy laws (except to the extent that they are pre-empted by the Privacy Rule) and shall not engage in any activity that would result in covered entity being in violation of any other state or federal privacy law. V. Term and Termination. A. Term. The Term of this [BAA] shall be effective as of 4-14-03, and shall terminate when all of the PHI provided by Covered Entity to Business Associate, or created or received by Business Associate on behalf of Covered Entity, is destroyed or returned to Covered Entity, or, if it is infeasible to return or destroy [PHI], protections are extended to such information, in accordance with the termination provisions in this Section V. B. Termination for Cause. 1. Material Breach. In the event that Covered Entity determines that Business Associate has materially breached this [BAA], Covered Entity may either (i) immediately terminate this [BAA] and any other related agreements or (ii) provide Business Associate with an opportunity to cure the breach in accordance with Section V.B.2. In the event of a termination pursuant to this section, the provisions of Section V.C. shall apply. 2. Opportunity to cure option. Covered Entity may elect to notify Business Associate of a material breach and provide Business Associate with the opportunity to cure the breach upon mutually satisfactory terms. Provided however, in the event that the Parties do not agree to mutually satisfactory terms within 60 days, Business Associate shall cure the breach to the satisfaction of the Covered Entity within 60 days. Business Associate's failure to cure a breach as set forth in this subsection is grounds for the immediate termination of this Agreement, and any other related agreements. C. Effect of Termination. 1. Return or Destruction of PHI. Except as provided in Section V.C.2, upon termination of this [BAA], for any reason, Business Associate shall return or destroy all PHI received from Covered Entity, or created or received by Business Associate on behalf of Covered Entity. This provision shall apply to PHI that is in the possession of subcontractors or agents of Business Associate. Business Associate shall retain no copies of the PHI. -9- 2. Return or Destruction Infeasible. In the event that Business Associate determines that returning or destroying the PHI is infeasible, Business Associate shall provide to Covered Entity notification of the conditions that make return or destruction infeasible. Upon mutual agreement of the Parties that return or destruction of PHI is infeasible, Business Associate shall extend the protections of this [BAA] to such PHI and limit further uses and disclosures of such PHI to those purposes that make the return or destruction infeasible, for so long as Business Associate maintains such PHI. d. VI. Miscellaneous. *** B. Interpretation. Any ambiguity in this [BAA] shall be resolved in a favor of a meaning that permits Covered Entity to comply with the Privacy Rule. *** D. Survival. The respective rights and obligations of Business Associate under Section V.C of this [BAA] shall survive the termination of this Agreement. THE TERMINATION OF THE BUSINESS RELATIONSHIP 18. At some point in the Fall, 2008, Dr. Leo Farrell approached Dr. Sakol about altering the payment terms of the Oral Agreement. 19. Dr. Leo Farrell advised Dr. Sakol that the Sakol payments were insufficient to cover the Sakol share of the actual cost of the services Farrell provided to Sakol under the Oral Agreement and that Sakol had to pay more, in the form of a flat fee (and not a percentage of Sakol cash collections). 20. Thereafter, Dr. Sakol and Dr. Leo Farrell had numerous discussions regarding the financial justification for Farrell's request for increased remuneration and the proposed changes to the Oral Agreement and payments made thereunder, as did Sakol's accountant and Farrell's -10- accountant. 21. It is believed, and therefore averred, that Sakol's accountant and Farrell's accountant exchanged information about Farrell's finances during early January, 2009. 22. At some point in early January, 2009, Dr. Leo Farrell demanded that Sakol pay the flat fee of $30,000.00 to commence retroactively to January 1, 2009, which Dr. Sakol refused and which caused him to begin to evaluate the termination of the Oral Agreement on financial grounds. In addition, Farrell's accountant told Dr. Sakol that if Sakol did not pay the demanded flat fee of $30,000.00 per month, Sakol should terminate the Oral Agreement with Farrell and leave. 23. At no time during the negotiations and discussions between Dr. Sakol and Dr. Leo Farrell or during the discussions between Farrell and Sakol's respective accountants, did any discussion about a "transition" from the old payment arrangement under the Oral Agreement and the $30,000.00 per month flat fee payment demanded by Farrell arise. That is, Dr. Leo Farrell and Farrell's accountant represented to Dr. Sakol and Sakol's accountant that the flat fee had to begin on January 1, 2009, without any adjustment. 24. During the entire term of their relationship under the Oral Agreement including but not limited to during the discussions in late 2008 and early 2009, Dr. Leo Farrell and Dr. Sakol, nor their practice respective accountants, never discussed or agreed upon anything other than fifty percent (50%) payment of the prior month's cash collections (as adjusted) as compensation for the services rendered by Farrell to Sakol and as set forth above. Furthermore, while the Oral Agreement was in effect: a. Farrell never reviewed Sakol's accounts receivable with Sakol either on a -11- regular basis (monthly, quarterly or annual) or on an ad hoc basis. b. Farrell never claimed entitlement to 50% of Sakol's accounts receivable that were uncollectible. c. It is believed, and therefore averred, that Farrell never, in any financial, tax or management report, identified the value of 50% of Sakol's accounts receivable as an asset of Farrell. d. Dr. Sakol provided occasional services as an independent contractor to Farrell and to Farrell's cosmetic patients for which Sakol was paid a net amount of 50% of the fees Farrell collected for such services which, during the beginning of the Oral Agreement was a more significant part of the Sakol Payment but which dissipated over time and ultimately stopped during the course of the Oral Agreement. Such independent contractor services and the fees collected by Farrell thereunder allowed Sakol to pay Farrell for the services rendered under the Oral Agreement prior to the maturity of the Sakol Practice. 25. These negotiations continued with Dr. Leo Farrell giving to Dr. Sakol, on or about January 7, 2009, a report of Farrell's accounts receivable as of the end of 2008. Dr. Sakol reviewed this report and determined that, in his belief, Farrell had committed billing fraud by billing insurance companies for services (laser treatments) which were actually performed by Dr. Deborah Farrell but for which Dr. Leo Farrell was billed as the treating provider as identified on said accounts receivable report. 26. As a result of his belief that Farrell has committed fraud, Dr. Sakol immediately -12- took action to investigate further, to wit: a. Dr. Sakol inquired of Ms. Erdman relative to the aforementioned alleged billing fraud and she advised him of other questionable office practices which he also believed to be billing fraud, to wit: i. "Upcoding" (performing one level of medical service and billing an insurance company for a more complex and expensive level of medical service); ii. Altering of records requested for audit by insurance companies; and iii. Other improprieties. b. Dr. Sakol verified Dr. Deborah Farrell's credentials and learned that Dr. Deborah Farrell was not then Board Certified by the American Board of Pediatrics and was continuing to hold herself out as a Board Certified physician in advertisements and on the Farrell Internet website which Sakol believed to be a willful deception on the public and a violation of the State Board of Medicine rules and regulations. 27. At that juncture, Dr. Sakol, feeling uncomfortable about being associated with Farrell, and believing that Farrell had committed fraud, determined that he no longer wished to be involved in a business relationship with Farrell and accelerated his efforts to terminate the Oral Agreement and the BAA. 28. On January 23, 2009, Sakol terminated the Oral Agreement and the BAA by ceasing his practice at the Farrell Practice Location. -13- 29. While Sakol terminated the Oral Agreement and the BAA on January 23, 2009, it could not move into the Sakol Location until February 16, 2009, as the Landlord had to perform some build-out work therein, so Sakol operated out of another suite at 2025 Technology Parkway temporarily until February 16, 2009 (the "Temporary Location"). 30. January 23, 2009 was a Friday and Sakol first began practicing in the Temporary Location on Monday, January 26, 2009. THE POST TERMINATION SETTLEMENT AGREEMENT 31. On January 26, 2009, undersigned counsel delivered to Farrell, via hand-delivery, the attached correspondence, atrue and correct copy of which is attached as Exhibit "B", notifying Farrell that the Oral Agreement was terminated and setting forth the requirements for the parties to continue their separate practices thereafter. 32. On February 12, 2009, Farrell acknowledged undersigned counsel's letter dated January 26, 2009, with a responsive facsimile, a true and correct copy of which is attached hereto as Exhibit "C". 33. On February 16, 2009, Sakol began operating in the Sakol Location. 34. On February 17, 2009, undersigned counsel responded to Farrell's February 12, 2009 correspondence, atrue and correct copy of which is attached hereto as Exhibit "D". 35. Farrell responded to undersigned counsel's February 17, 2009 by facsimile on the same date. A true and correct copy of said facsimile response is attached hereto as Exhibit "E". 36. Undersigned counsel responded to Farrell's February 17, 2009 facsimile with a letter dated February 18, 2009, sent via facsimile and regular mail, a true and correct copy of -14- which is attached hereto as Exhibit "F" 37. Undersigned counsel's February 18, 2009 correspondence contained, inter alia, a proposal for Sakol to pay Farrell the amount of $11,346.22 (as identified in undersigned counsel's letter dated February 17, 2009, "Sakol Offer"). 38. Farrell responded by facsimile dated February 18, 2009, in which Farrell agreed to the 5akol Offer but including counterprovisions requiring payment by March 2, 2009 and a demand for a deduction for Ms. Erdman's work after January 23, 20096 (the "Farrell Counter") A true and correct copy of said facsimile dated February 18, 2009 is attached hereto as Exhibit ..G.. 39. Undersigned counsel provided Farrell's counsel with a first draft of a Confidential Settlement Agreement and Release ("Agreement") on February 25, 2009, just seven (7) days after the Farrell Counter was proposed and five (5) days before March 2, 2009. A true and correct copy of the covering email to Farrell's counsel with the attached Agreement is attached hereto as Exhibit "H". The Agreement represents a binding contract to terminate the Oral Agreement as it contains: a. The amount of the Farrell Counter, (the Sakol Offer plus the Erdman Adjustment , a total of $11,494.97), as consideration (the "Settlement Monies"); b. A complete Mutual Release; c. No admission of liability for either party; d. Reciprocal Confidentiality and Non-Disparagement provisions; and Identified in the Sakol Offer as $148.75 (the "Erdman Adjustment"). -15- e. Other ordinary release and settlement provisions. 40. The day before, February 24, 2009, undersigned counsel advised Farrell's counsel by email that the Settlement Monies were in undersigned counsel's Escrow Account and ready to be paid upon execution of the Agreement, a true and correct copy of said Email is attached as Exhibit "I". 41. On March 2, 2009, Farrell's counsel advised undersigned counsel that she had not yet met with Dr. Farrell at 4:16 p.m. by that date. As a result, the Agreement was not signed by March 2, 2009. 42. On March 4, 2009, Farrell's counsel advised undersigned counsel that she would be meeting with Farrell the following Monday (March 9, 2009) to review the Agreement. 43. For the first time on March 5, 2009, Farrell, through counsel, advised undersigned counsel that the Agreement which accepted and embodied the terms and conditions of the Farrell Counter would not be executed by Farrell. 44. For the first time on March 10, 2009, Farrell, through counsel, demanded that Sakol pay a percentage of the Sakol cash collections which post-date the termination of the Oral Agreement. THE POST TERMINATION ACTIONS OF FARRELL 45. From and after the date the Oral Agreement and BAA were terminated, Farrell engaged in a course of conduct which was injurious to Sakol, including, but not limited to the following: a. Sakol's patients were told by Farrell that 5ako1's new practice location was -16- unknown notwithstanding undersigned counsel's repeated requests to correct this course of conduct and despite being advised about both the Sakol Location and Temporary Location in correspondence; b. Upon information and belief, Sakol's patients were being diverted by Farrell for procedures for Dr. Deborah Farrell to perform; c. Farrell continued to include Dr. Sakol's name on the Farrell letterhead; d. Prospective patients, looking for Dr. Sakol and who called Farrell, were advised that Farrell had no forwarding information regarding Dr. Sakol or his practice; e. Farrell, in its facsimile dated February 17, 2009, made patently false statements which constitute defamation per se; f. Dr. Farrell further defamed Dr. Sakol by communicating to third-parties certain misinformation about the termination of their business relationship; g. Farrell continued to use Dr. Sakol's likeness, image and inclusion of his name on the Farrell website; h. Farrell refused to remove Dr. Sakol's name with Verizon and other phonebooks causing confusion with Sakol's own Verizon and other phonebook listings; i. Farrell placed classified advertisements with the Patriot News and instructed the Patriot News to bill Sakol; j. Farrell instructed its medical answering service to withhold Sakol's contact information from callers who inquired of same; and -17- k. Farrell intentionally and repeatedly utilized the Sakol Separate Database to its benefit and to Sakol's detriment as set forth below in violation of the BAA and HIPAA. COUNTI BREACH OF CONTRACT -ORAL AGREEMENT 46. Plaintiff hereby incorporates Paragraphs 1 through 45 as if fully set forth herein. 47. Farrell committed fraud during the term of Oral Agreement which operates as a breach of the Oral Agreement, to wit: a. Farrell's former Office Manager, Gail C. Erdman, avers, in her Answer to Complaint with New Matter in the case Farrell Plastic Surgery and Laser Center. P.C, v. Gail Erdman, 09-7616, Cumberland County, Pennsylvania (the "Erdman Lawsuit") (a copy of which is attached hereto as Exhibit "J", the "Erdman Pleading") that she "...became aware that Dr. Farrell was perpetrating fraud upon various insurance companies, by representing that he was performing various procedures on patients when in fact others who were not accredited with the insurance companies to perform those procedures were actually performing them, primarily his wife.". Erdman Pleading, ¶23. She also avers, "at least on one occasion he requested that [Ms. Erdman] participate in altering records in anticipation of an insurance audit." Erdman Pleading, ¶24. b. Two (2) other former employees of Farrell, Rachelle Hoffman and Jennifer Messick, both experienced the following: i. Dr. Deborah Farrell treating certain patients and completing their -18- treatment charts, while Dr. Leo Farrell signed those treatment charts as if he were the providing physician; ii. Were told by Ms. Erdman about "upcoding"' in Farrell billing about which Ms. Erdman communicated her concern to them; and iii. Observed other employees of Farrell, Christy Warfel and Angie Sterner, altering patient charts prior to an insurance audit and change the designation of Dr. Deborah Farrell thereon, identified as "DMF", to "Farrell" to defraud the auditing insurance company by suggesting that Dr. Leo Farrell indeed performed the services as indicated on the altered records. 48. Upon information and belief, Dr. Leo Farrell instructed Ms. Erdman to focus her collection and accounts receivable efforts on Farrell and devote much less time to Sakol regarding same during the time the Oral Agreement was in effect. This practice continued up through and including the middle of 2008. 49. Dr. Leo Farrell, sometime in the middle of 2008, instructed Ms. Erdman to accelerate the collections and accounts receivable work for Sakol, for reasons unknown to Sakol. 50. Insurance companies typically dishonor claims submitted late and for which incomplete documentation is submitted or for which documentation is not provided in response to inquiries and request for information from those same insurance companies. 51. Because Dr. Leo Farrell instructed his employee, Ms. Erdman, to spend less time ' Performance one level of medical service and billing an insurance company for a more complex and expensive level of medical service. -19- on the Sakol collections, many of the Sakol claims submitted to insurance companies were either submitted late or with insufficient documentation all of which resulted in Dr. Sakol's collections suffering and accounts receivable soaring. 52. At this juncture, an amount yet to be determined, but which upon information and belief is greater than $50,000.00, is still uncollected and remains on Sakol's accounts receivable ledger (and is thus, uncollectible) for services performed by Sakol prior to the termination of the Oral Agreement on January 23, 2009. 53. The aforementioned conduct, that is, Farrell's manipulation of the Ms. Erdman's efforts in connection with Sakol's collections is a breach of the Oral Agreement and the cause of damages to Sakol. 54. Sakol has suffered damages in connection with said breach of the Oral Agreement for which compensation is hereby sought. WHEREFORE, the Plaintiff, Peter J. Sakol, M.D., LLC, respectfully requests this Honorable Court to determine that the Defendant, Farrell Plastic Surgery and Laser Center, P.C., breached the Oral Agreement by and between them and award the Plaintiff his compensable damages, in an amount which exceeds the compulsory arbitration limit for this judicial district, costs, attorney fees, and other just relief this Court deems appropriate. COUNT II NEGLIGENT SUPERVISION 55. Plaintiff hereby incorporates Paragraphs 1 through 54 as if fully set forth herein. 56. The Erdman Lawsuit details alleged conduct by Ms. Erdman which purports to -20- have caused Farrell to be damaged in the amount of $56,434.97. 57. It is believed, and therefore averred, that Ms. Erdman conducted her office management/ billing and collection efforts for Sakol in the same manner that she conducted it for Farrell. 58. At all times relevant hereto, Farrell had a duty to supervise Ms. Erdman with respect to her work in connection with Sakol's office management/billing collection pursuant to the Oral Agreement. 59. It is believed, and therefore averred, that Farrell breached its duty to Sakol in connection with its supervisory capacities over Ms. Erdman which caused damages to Sakol. 60. As a result of Farrell's breach of said duty, Sakol was damaged in an amount which is yet to be determined and which was caused by Farrell's negligent supervision of Erdman. WHEREFORE, the Plaintiff, Peter J. Sakol, M.D., LLC, respectfully requests this Honorable Court to determine that the Defendant, Farrell Plastic Surgery and Laser Center, P.C., negligently supervised Gail C. Erdman to Sakol's detriment and award the Plaintiff its compensable damages, its costs, attorney fees, and other just relief this Court deems appropriate. COUNT III RESPONDEAT SUPERIOR 61. Plaintiff hereby incorporates Paragraphs 1 through 60 as if fully set forth herein. 62. At all times relevant hereto, Ms. Erdman was Farrell's employee and her actions caused damages to Sakol. -21- 63. As a result of Ms. Erdman's conduct, Sakol has been damaged in an amount yet to be determined, for which, Farrell is responsible under the doctrine of respondeat superior. WHEREFORE, the Plaintiff, Peter J. Sakol, M.D., LLC, respectfully requests this Honorable Court to determine that the Defendant, Farrell Plastic Surgery and Laser Center, P.C., find Farrell liable for damages Sakol sustained as a result of Ms. Erdman's actions, under the theory of respondeat superior and award the Plaintiff its compensable damages, costs, attorney fees, and other just relief this Court deems appropriate. COUNT IV BREACH OF BUSINESS ASSOCIATE AGREEMENT - HIPAA VIOLATIONS - REQUEST FOR INJUNCTIVE RELIEF 64. Plaintiff hereby incorporates Paragraphs 1 through 63 as if fully set forth herein. 65. Farrell continues to possess the Sakol Separate Database which violates the BAA and HIPAA. 66. Sakol, has, on repeated occasions since termination of the Oral Agreement demanded that Farrell destroy Sakol's Separate Database. 67. Upon information and belief, it is averred that on or about September 1, 2009, Farrell, accessed the Sakol Separate Database, identified those Sakol patients who had previously treated with Sakol for Rosacea$ (whose medical records are contained in the Sakol Separate Database and who never were a patient of Farrell, identified herein as "Sakol's Rosacea ° The medical condition is one of many data field entries contained within the Sakol Separate Database. Since the Sakol Separate Database may be sorted by medical condition, Farrell's access to and use of the Sakol Separate Database to target Sakol's Rosacea Patients is quite easy to do. -22- Patients"), and sent a mailing to one or more of the Sakol's Rosacea Patients, an undated letter with a copy of the envelope which accompanied it bearing a postmark of September 1, 2009, is hereby attached as Exhibit "K" (the "Farrell First Mailing"). Other Sakol patients (who were not Farrell Patients) who did not suffer from the medical condition of Rosacea, did not receive the Farrell First Mailing. 68. Many of Sakol's Rosacea Patients contacted Dr. Sakol after their receipt of the Farrell First Mailing, to complain about receiving the Farrell First Mailing and inquired about whether Farrell had access to their personal and private health information. 69. Although the BAA terminated on January 23, 2009, when the Oral Agreement was terminated, Farrell, through counsel, denied that the BAA was terminated and, therefore, Farrell was advised, through undersigned counsel's letter to Farrell's counsel dated September 3, 2009, a true and correct copy of which is attached hereto as Exhibit "L" that the BAA was terminated and that Sakol's PHI must be destroyed. 70. Undersigned counsel notified Farrell's counsel by letter dated September 10, 2009 about the Farrell First Mailing, a true and correct copy of which is attached hereto as Exhibit ..M.. 71. Farrell's (and Sakol's) computer hardware and software vendor, STI Computer Services, Inc. ("STI"), has expressed, in writing, that it is feasible for Farrell to destroy Sakol's Separate Database as set forth in the attached electronic mail message dated October 20, 2009 from STI Computer Services, Inc. to undersigned counsel (the STI Email"), a copy of which was attached to a letter dated October 26, 2009 from Attorney Charles I. Artz ("Mr. Artz") (Sakol's Co-Counsel in this action) to Farrell's counsel (the "Artz Letter"). A copy of the STI Email is -23- attached hereto as Exhibit "N". 72. The Artz Letter places Farrell, through counsel, on notice that Farrell, inter alia, violated the BAA and HIPAA, to Sakol's detriment as follows: a. The BAA obligated Farrell to return or destroy the Sakol Separate Database, once the relationship was terminated. b. The HIPAA Privacy Regulations impose a legal obligation on Sakol to demand destruction of all private health information (as defined under HIPAA, hereafter "PHI") Farrell received from it or created on Sakol's that Dr. Farrell still maintains in any form, and retain no copies of such information. 45 C.F.R. §164.504(e)(2)(I). c. The cessation of any billing and collection services or any other services that fall within the definition of a Business Associate, under the BAA, demonstrates Farrell has no legal basis to either retain, access or use any of Sakol's PHI. 45 C.F.R. § 160.103 (permitting use and disclosure of PHI for limited functions). d. The only way Farrell could have sent [the Farrell First Mailing] to [Sakol's Rosacea Patients would be to have accessed not only Sakol's patient names and addresses, but also to access those patients' prior treatment records and ICD-9 diagnosis codes, which would only be contained in the Sakol Separate Database. e. Farrell knowingly obtained and used individually identifiable health information relating to individuals with the intent to use it for commercial -24- advantage, and personal gain in violation of 42 U.S.C. § 1320d-6(a)(2)-(3) and § 1320d-6(b)(3). f. The HITECH Act has amended the aforementioned criminal sanctions by adding a new sentence: A person shall be considered to have obtained or disclosed individually identifiable health information in violation of this part if the information is maintained by a covered entity and the individual obtained or disclosed such information without authorization. HITECH Act, § 13409. g. Sakol maintained the data and demanded its destruction. Farrell refused to do so. Dr. Farrell retained the PHI without permission, then obtained and disclosed it without authorization from Sakol or any patient for a commercial purpose. 73. Notwithstanding previous notifications regarding potential HIPAA violations and violations of the BAA, Farrell sent another mailing, a postcard to Sakol Rosacea Patients , a true and correct copy of which is attached hereto as Exhibit "O" some time in the middle of November, 2009 (the "Farrell Second Mailing"). 74. As part and parcel of this scheme to contact the Sakol Rosacea Patients, Farrell had previously registered a fictitious name with the Pennsylvania Department of State on or about April 20, 2009, "Farrell Laser and Cosmetic Medicine Center" which, upon information and belief, is a vehicle under which Farrell is marketing Dr. Deborah Farrell's practice within Farrell to unfairly compete with Sakol by using the Sakol Separate Database as evidenced by the Farrell First Mailing and Farrell Second Mailing. -25- 75. A copy of the Farrell Second Mailing was provided to Farrell's counsel by undersigned counsel on November 25, 2009. 76. Sakol was contacted by many of the Sakol Rosacea Patients who received the Farrell Second Mailing, who were upset about receiving it and inquiring about what they could do to stop such mailings from Farrell. 77. Upon information and belief, numerous Sakol Rosacea Patients have filed Health Information Privacy Complaints with the U.S. Department of Health and Human Services Office for Civil Rights following their receipt of the Farrell Second Mailing. Further, the Farrell First Mailing and/or Farrell Second Mailing may subject Farrell to criminal sanctions and/or administrative sanctions under the State Board of Medicine's Rules and Regulations. 78. The terms of the BAA set forth above require Farrell to destroy the Sakol Separate Database. 79. Because of Farrell's actions of accessing the Sakol Separate Database and using it for its own personal gain by marketing to Sakol's Rosacea Patients, it is possible that a HIPAA violation occurred for which Sakol may be required to face an administrative action therefor. As such, Sakol seeks injunctive relief in the form of an Order requiring Farrell to destroy the Sakol Separate Database and to indemnify Sakol for the monetary costs of any such HIPAA violation. WHEREFORE, the Plaintiff, Peter J. Sakol, M.D., LLC, seeks injunctive relief in the form of an Order requiring Farrell Plastic Surgery and Laser Center, P.C. to destroy Sakol's Separate Database and, further, to order Farrell to immediately cease from accessing the Sakol Separate Database and using it for its personal gain and to indemnify Sakol for the monetary -26- costs of any such HIPAA action and award to the Plaintiff its compensable damages, costs, attorney fees, and other just relief this Court deems appropriate. COUNT V COMMERCIAL DISPARAGEMENT 80. Plaintiff hereby incorporates Paragraphs 1 through 79 as if fully set forth herein. 81. Farrell, as set forth in Paragraph 45 above, generally, and specifically in the Farrell First Mailing and Farrell Second Mailing, published disparaging statements to Sakol's Rosacea Patients, in that the content of the Farrell First Mailing and Farrell Second Mailing, as directed to Sakol's Rosacea Patients, suggests by implication that Sakol has inferior equipment and is not as well equipped as Farrell to treat their condition. 82. Because Sakol's Rosacea Patients were aware of the relationship between Sakol and Farrell (in that their practices were housed within the same physical location), any connotation that Sakol's equipment and services were inferior to Farrell's constituted false statements. Further, the statements identified in Paragraph 45 are patently false. 83. Farrell intended that its statements made as identified in Paragraph 45 and in the Farrell First Mailing and Farrell Second Mailing would cause pecuniary loss or reasonably should have recognized that they would cause pecuniary loss to Sakol. 84. While Sakol is unable to quantify who was affected by the false statements in Paragraph 45 and/or which of the Sakol Rosacea Patients responded to the Farrell First Mailing and/or Farrell Second Mailing, upon information belief, at least some individuals and/or some of the Sakol Rosacea Patients who would have otherwise sought services from Sakol, actually sought services from Farrell as a response thereto, which resulted in pecuniary loss to Sakol. -27- 85. Farrell knew that the statements made as identified in Paragraph 45 above and/or those made in Farrell First Mailing and Farrell Second Mailing was either false or in reckless disregard of its truth or falsity. WHEREFORE, Peter J. Sakol, M.D., LLC, requests that this Honorable Court find that Farrell's conduct constituted commercial disparagement against Sakol award Sakol compensatory damages, costs and punitive damages and other just relief the Court deems appropriate COUNT VI COMMON LAW -TRADE SECRET VIOLATION -EQUITABLE RELIEF 86. Plaintiff hereby incorporates Paragraphs 1 through 85 as if fully set forth herein. 87. Farrell was in a position of trust and confidence and had access to Sakol's trade secrets, the Sakol Separate Database, which was highly confidential and was a valuable asset of Sakol. 88. Upon information and belief, the Farrell First Mailing and Farrell Second Mailing were sent were addressed with computer-generated mailing labels. These computer-generated mailing labels are either identical in form and typestyle to those contained in or the source information come from directly taken from the Sakol Separate Database. Upon information and belief, Farrell accessed Sakol's Separate Database while Farrell held a position of trust and confidence with Sakol and had an obligation not to do so under the BAA or after its termination. 89. Farrell, by reason of its position, had access to information including but not limited to the Sakol Separate Database which was highly confidential and constituted a valuable asset of Sakol. -28- 90. The Sakol Separate Database was a trade secret of Sakol which was and remained entitled to protection, independent of any non-disclosure contract or covenant not to compete. 91. The trade secret and proprietary information included inter alia patient names, addresses and telephone numbers, patient lists, patient information complied by Sakol, medical records, pricing and billing information, patient development and advertising techniques and the like. 92. The Sakol Separate Database is only known to Farrell (under the BAA) and Sakol and are not known to others engaged in a medical practice outside Farrell. 93. Sakol has made substantial efforts and has implemented substantial measures to guard the secrecy of its trade secrets and proprietary information in the Sakol Separate Database and which are of substantial value to Sakol and any competitor of Sakol would secure an extraordinary benefit by obtaining this information. 94. Sakol expended substantial effort and money in developing the trade secrets and proprietary information referenced above and which could only be acquired by accessing or printing the Sakol Separate Database on computer hardware and software owned by Farrell. 95. The vast majority of patients who sought treatment from Sakol were developed as a result of Sakol's goodwill in the community, referrals by existing patients or through advertisements created and paid for by Sakol thereby entitling Sakol to the exclusive use and enjoyment of their trade secrets and proprietary information. 96. Farrell's actions as aforesaid were knowingly and willfully wrongful and by reason of Farrell's breach of duty to honor and protect Sakol's trade secrets and proprietary information and Sakol has been irreparably harmed. -29- 97. Farrell's conduct has directly interfered with Sakol's existing relationships with his patients. 98. No adequate remedy at law exists to cure Farrell's misappropriation and improper use of Sakol's trade secrets and proprietary information or Farrell's interference with already established professional doctor-patient relationships. Although the alternative counts in this Complaint request monetary damages as an element of Farrell's misappropriation of trade secrets and interference with Sakol's patient relationships, such damages are not adequate inasmuch as Farrell's conduct will devastate Plaintiff s protectable trade secrets and patient relationships which are unique and immeasurably valuable assets acquired as a result of his effort over a long period of time and the effect of Farrell's conduct is unascertainable and irreversible. WHEREFORE, Peter J. Sakol, M.D., LLC, requests that this Honorable Court find that Farrell violated Sakol's common law rights to its Trade Secrets and enjoin Farrell from future violations by requiring the destruction of the Sakol Separate Database. COUNT VII TRADE SECRET VIOLATION -COMMON LAW -DAMAGES 99. Plaintiff hereby incorporates Paragraphs 1 through 98 as if fully set forth herein. 100. Farrell's knowing and willful breach of duty to honor and protect Sakol's trade secrets and proprietary information as detailed, supra, have caused Sakol significant but unliquidated monetary damages, in an amount which, upon information and belief, exceeds $50,000.00. -30- WHEREFORE, Peter J. Sakol, M.D., LLC, requests that this Honorable Court find that Farrell violated Sakol's common law rights to its Trade Secrets and awazd Sakol compensatory damages, costs and punitive damages and other just relief the Court deems appropriate. COUNT VIII TRADE SECRET VIOLATION -STATUTORY VIOLATION OF 12 Pa. C.S.A. 5301 et seq. THE PENNSYLVANIA TRADE SECRETS ACT 101. Plaintiff hereby incorporates Paragraphs 1 through 100 as if fully set forth herein. 102. Farrell's action as described above constitute misappropriation pursuant to Pennsylvania's Trade Secret Act, 12 Pa. C.S.A. §5301 et seq (the "Act"). 103. The Sakol Sepazate Database is a trade secret in that Sakol derived independent economic value for it not being generally known to, and not being readily ascertainable by proper means by other persons who can obtain economic value from its disclosure or use. 104. Farrell's use of the Sakol Sepazate Database described above constitutes misappropriation under the Act in that Farrell disclosed Sakol's Separate Database without the express or implied consent of either Sakol or the individual patients whose information is contained in the Sakol Sepazate Database and which is also protected by HIPAA. 105. Farrell knew at the time it misused the Sakol Separate Database that Farrell had acquired it under circumstances giving rise to a duty to maintain its secrecy or limit its use, generally under HIPAA and specifically under the BAA. 106. Sakol is entitled to injunctive relief under the Act to eliminate the commercial advantage that Farrell derives from the use of the Sakol Sepazate Database and to prevent further and to avoid future violations of HIPAA by Farrell. -31- 107. Sakol is entitled to monetary damages under the Act if damages cannot be calculated pursuant to the Act's Section 5304(a) which authorizes the imposition of a reasonable royalty for Farrell's unauthorized disclosure and use of the Sakol Separate Database. 108. Sakol is also entitled to exemplary damages under the Act's Section 5304(b) as Farrell's use of the Sakol's Separate Database as willful and malicious as term is defined in the Act's Section 5302, in particular, because Farrell was advised prior to the Farrell First Mailing to destroy Sakol's PHI and was advised repeatedly after the Farrell First Mailing and before the Farrell Second Mailing that the Sakol Separate Database constituted private patient information subject to HIPAA. 109. Farrell's willful and malicious misappropriation of trade secrets described above entitles Sakol to attorney fees under the Act's Section 5305. WHEREFORE, Peter J. Sakol, M.D., LLC respectfully requests this Honorable Court determine that Farrell Plastic Surgery and Laser Center, P.C. violated the Pennsylvania Trade Secrets Act, award it appropriate injunctive relief thereunder, compensatory damages under Section 5304(a), punitive damages under Section 5304(b) and attorney fees under Section 5305 all of which exceeds this Courts limit for compulsory arbitration, its costs and other just relief the Court deems appropriate. COUNT IX TORTIOUS INTERFERENCE WITH DOCTOR/PATIENT RELATIONS 110. Plaintiff hereby incorporates Paragraphs 1 through 109 as if fully set forth herein. -32- 111. Sakol had existing doctor-patient relationships with thousands of patients for whom Sakol provided treatment and Sakol had a reasonable expectation of continuing such relationships. Upon information and belief, Farrell solicited Sakol's patients from the Sakol Separate Database. The names and addresses of these patients have not been presented at this time in consideration of the patients' protection and privacy rights. The names and addresses will be made available upon execution of a proper confidentiality agreement and Order from the Court which protects the interests of Sakol and its patients. 112. Farrell, because of its Oral Agreement and BAA with Sakol, extensive knowledge of Sakol's practice and patient lists and Farrell's improper use of the Sakol Separate Database, knew of the aforementioned contracts and the Sakol's patients. As a result of Farrell's conduct described in detail, su ra consisting of pilfering Sakol's Separate Database, trade secrets and proprietary information, such conduct was intended to and has in fact disrupted and interfered with Sakol's relationships with its patients. 113. By engaging in the conduct described in the forgoing Paragraphs, Farrell intended to impair or destroy Sakol's relationships with its patients, thereby destroying Sakol's expectancy of continuing the doctor-patient relationships and the economic gains derived therefrom. 114. By pilfering Sakol's confidential patient information and use thereof Farrell's conduct constitutes unlawful and improper means of attempting to solicit patients. 115. Farrell's stealth tactics to pilfer Sakol's confidential patient information and use of the Sakol Separate Database Farrell's motive and an intent to destroy Sakol's practice. 116. Farrell was not justified or privileged to engage in the conduct described above, which resulted in the impairment or loss of Sakol's relationships with its patients. -33- 117. It is unknown how many Sakol patients have terminated their doctor-patient relationship, but, upon information and belief, one or more of Sakol's patients have terminated their doctor/patient relationship as a direct and proximate result of Farrell's actions identified above. 118. The conduct engaged in by Farrell and described in detail above was a substantial factor in and the proximate cause of the loss or impairment of Sakol's relationships with his patients which resulted in Sakol's loss of the expectancy of continuing the doctor-patient relationships and the economic gains derived therefrom. 119. As a direct and proximate result of Farrell's intentional and tortious interference with contracts and relationships between Sakol and its patients, and as a result of the impairment or loss of Sakol's relationships with his patients, Sakol has suffered a loss and has been deprived of the economic expectancy arising from the relationships, which they would have earned but for Farrell's unlawful conduct, in an amount which is unliquidated but, which upon information and belief, exceeds $50,000.00. 120. Farrell's intentional and tortious interference with contracts and relationships between Sakol and their patients is continuous and ongoing and damages continue to accrue. Farrell's conduct has been so outrageous as to shock the sensibilities of a reasonable person, thereby warranting imposition of punitive damages. WHEREFORE, Plaintiff, Peter J. Sakol, M.D., LLC, requests that this Honorable Court find that Farrell's conduct constituted tortious interference with Sakol's doctor/patient relations -34- and award Sakol compensatory damages and punitive damages and other just relief the Court deems appropriate. COUNT X TORTIOUS INTERFERENCE WITH PROSPECTIVE CONTRACTUAL RELATIONS 121. Plaintiff hereby incorporates Pazagraphs 1 through 120 as if fully set forth herein. 122. A variety ofthird-parties, some of whom, upon information and belief, were potential patients of Sakol's, contacted Farrell after January 23, 2009 to inquire about the Sakol Practice. 123. The actions identified in Pazagraphs 45 and 64 through 120 above constitute evidences of Farrell's purposeful or intentional harm to Sakol by preventing the doctor/patient relationship from occurring by its actions. 124. Farrell had no privilege or justification to commit the acts identified in Paragraphs 45 and 64 through 120 above. 125. Although it is not immediately possible without Discovery to quantify the actual damage caused to Sakol as a result of Farrell's conduct identified above, upon information and belief, the sum of the third-parties who inquired of Farrell who otherwise would have become Sakol patients, did not do so as a result of Farrell's actions and, therefore, Sakol has suffered actual damages as a result. WHEREFORE, Plaintiff, Peter J. Sakol, M.D., LLC, requests that this Honorable Court find that Farrell's conduct constituted tortious interference with Sakol's prospective contractual -35- relations and award Sakol compensatory damages and punitive damages and other just relief the Court deems appropriate. COUNT XI CLAIM FOR ATTORNEY FEES UNDER Pa. R. CIV. P. 1023.1 126. Plaintiff hereby incorporates Paragraphs 1 through 125 as if fully set forth herein. 127. Farrell was advised in the Artz Letter that due to the absence of any legitimate defense and because of the apparent economic motives, Farrell should regard the Artz Letter as a Rule 1023.1 notice that Sakol would seek attorneys' fees and sanctions thereunder. 128. Notwithstanding the Artz Letter, Farrell sent the Farrell Second Mailing. 129. By letter dated December 18, 2009, Mr. Artz sent afollow-up letter to Farrell's counsel to advise that litigation was proceeding notice under Pa. R.Civ.P. 1023.1, a true and correct copy of which is attached hereto as Exhibit "P", and which stated as follows: "We are proceeding with the litigation and present this letter, which also incorporates by reference my October 26, 20091etter, as a Rule 1023.1 notice to Dr. Farrell and [Farrell] .... From this moment, [Farrell] will be held responsible for all legal fees incurred in the litigation attempting to secure destruction of [Sakol's] PHI." 130. Farrell's actions enumerated herein require the Court to award Sakol its attorney fees under Pa. R. Civ. P. 1023.1. -36- WHEREFORE, Plaintiff, Peter J. Sakol, M.D., LLC, requests that this Honorable Court determine that Farrell's conduct violated Pa. R. Civ. P. 1023.1 and award Sakol attorney fees and punitive damages and other just relief the Court deems appropriate COUNT XII PUNITIVE DAMAGES 131. Plaintiff hereby incorporates Pazagraphs 1 through 130 as if fully set forth herein. 132. Counts IV, V, VI, VII, VIII, IX and X aze causes of action for which punitive damages may be awazded by this Court. 133. Farrell's conduct, more specifically described above, exhibits utter indifference and/or conscience disregazd for Sakol's rights and is so outrageous so as to reveal Farrell's evil motive or its reckless indifference to Sakol's rights and is malicious, wanton, reckless, willful or oppressive upon Sakol and punitive damages are warranted in this case. WHEREFORE, Plaintiff, Peter J. Sakol, M.D., LLC, requests that this Honorable Court award Sakol punitive damages and other just relief the Court deems appropriate C GHAM & CHERNICOFF, P.C. sy ~" ruce . Wazshaws squire PA Supreme Court ID# 58799 CUIVNINGHAM & CHERNICOFF, P.C. 2320 North Second. Street Harrisburg, PA 17110 Telephone: (717) 238-8187 Attorneys for Plaintiff Date: February 3, 2010 -37- EXHIBIT `A' ,, ,. a ~ ~ ~ ~~. .. ,,. Qt151N~~S;p,~SSO.I~#J ,~~rR~EMENT ''~ The parttesaothis ~ge>a~ Peba~.~~`S~ekct, M D., L;L.C: ("Co~cered.~ntrty"}, a:.. physic{an group:practk~ v~ith :if~8 ppa~;~o'~ atr2~ Tr~dkt~t~of~gy R'arkw~y,` Su{te: 2Q4, AAectfan~rg,"~F~A 1'~tQ i~rnd. business Associate"), a . ~ :vvitt#~' . ~ipdY~aP~ce at (collectively,. the "Pa "~•.... .. ~:. n: i , Co!~ehec##`~tt ~~~st~b~ i~. ~`~CSt,:~'~ r~t1. ~~~`~'~ t~te~ Q~,pa~me~~t ~f~ . , . Healtt't~~IrttiY~lan#a~``~ii~l~ °.', ~,,~~~~ ~f~-tt~~~a~ce P'~r#aibiiR~r and Acoourrtability Ad ~'H1p~-A~'`j: ^ Priva+c~ Rule (a~k~~I Stl~i`~ taK #~;icy ~f fndividustly-ldenl~#iabk~. Weafth . , Information) -This Ni$ IS f~~~~ ~~',~, Part'~~k- It tabll~f~es 3fi~nS1aL~S. fiorthe p ~ ol` p~r~riIt~ t~a~,~Cred~~~r`ie requlr~ under ~e rule .t4. Qbt `prr rYC ~i~i0~:~ too whlc~t if discloses ~ health: infon~i~atk per::'~a:rti~ (`'F~ ari~/or v~hit t~af~ t~o txea~~~ir r~c~#t~e PHF on its behalf: ^ Transr>~~and ~ ~ ~~- r T,t~i~.xias~f€~li~l~t~ a~ 4~ C 1= R P'ar~ 162.1# es#abl{~hes S~snd~rd$ ~:~~~ ~!bia~n' of olal~s arrtl';ofi~er fiealtl~ care tra3thsa+~ns {'"~'n':ii"i~tt'ts~} !~ii~ ~qui ue~th~a turfy to~re~q>aire certain enti#fees which coc~ductT.i~rns#.its,whole or parx Qn .its:,:behalf to,comply with he rule with tespect.ba Triers anti fid~re`q~+a".tftelr en~a apt. s~lbeor~at~ors its x~ly:'WI'~e ale wlt#~-ri~~$uch. Tt~aA~iicdons: The Partie:3 aye to `be iggal(~ C'Xtn~ lathe a and coFldlflt~ns set forth in tl'iis Ag[eement: :. - l. t~fieitions.~ . _ . "Individual" shel{~ftave't4~e sam>r nn the~#erm.:"individrJal"`n 4a'`C.)`.R. . §184.501 and sh>3{t indude;a pen~rt wha gtyailfies as a personal; repn3aentatii-e in accordancewith 45 C.p 1~.,§,1Y~Q}r ~ h :~- ;: "Ot{°°i~ si~ arrtl' federal ~ ,~ .: ~~ ~lnrEt`*a>utxars °rlot firYirt to prof~ss,,ional . licensing regutatlons~~fot~pti ~iiY~ (48 ~~et. Cc~d+a §~6.8~i. §5:213), t#~e Confidentiality of HIS/-Related it~#orfnation AcC (35:P:~. ~§76tt1=78'{2), #-e. liAe~l hiea{th Pcocedun3s Act and ~regulatiorls (~0 P:S. §711,1.; 55 Pa~:`Cade .§.510.0:3'1-g1.00.3a), and the federal protections for drug and alcohol abuse tF9atn'lent feCOrd9 (42 U.S:C: 29add-2; 42 C.F.R. §§2.1-2.87), "Rrlvacy Rule" shalt:r>lean t#ta ~and~rds _fior Privacy. of lndividualijl-ldentffiab{e Hea{ttl informatlort promctiga#ed::byas Qepartrni~~f of #feaith~ and Human Services ' pursuarrt to the. Healti'L insurant~ Piarti~b~tit7l an~d`~4c:cvurrta@ility Act at: 45 C.E.R. Part 164. . "PHA' shall have the da~a~: rdri~''°'ai~~3~h~i`t~i "F~#~il"`irf 45 C.F:R: X164:501, limited to the .ir~om~a#ion created ~ar t~ei~ed by l~u~i~!ese sodata fr+o~n ©r:on~ behalf of ~ ` Covered ~rdit~/- . , : ,: ~ . "R~qurt~e~i;.By Lave" ~t1al[~=f~ a irft~ing`i~ #~ tet~r~ "r~equl~ed Eby law" in 45 C.F;Ft § 1$4501 ~ .~ "~~" a~C r~~~~te ~S~creta~y~!f tie=impartment of klealt~h and Muman 5eri~icss.orhls.ort~er~desi~e~ ~ .. :: ,~. .. - Transaction" n>ie~ans s t~ar~sac~n:~ubjto the:Tra~sac~©n and Code Set Ruie. "Transactions and Code Sot Rule" s~~U min the T~s~ctions and Cade Set~ru~ ' promuigafied.U~i.#t~e.,,D~pat~ o~;hl~ilti"~~tfd~oiii~°~~t ~+e~ri~ ~u~8uantto #f~e. Heafth. Insurance l~ortabtiily and k~or~irl'~bil(fy,~t~.i'~'~5 e:~.R.~P~rt:`~2. R. Penlnitbsd uses and diactosuree .by ~trslrl+E~ .Aasc~ .. A. C~ral.~uses ~rt~t dia~iasuresr~ ~ 4 , rgs o~erwns~e hmi~ed ~n,thls.:Agree~nent, Blts~ile~$8 ~E~ r~a~1.:.r:+~t~disoio lr~~pdr~G~'fi~ fiui011~;8t~Fitj@S.:Or . setvl~es for,: ox.~n-~ha1f trE, .C~vs~l,l~~' ~~xav~d'e~d'tt~at sacti use or disc~osurr vVoufd nc~.viols#e~-f#i~;t?riv~wy. Rr~ls. ';', ' ~. . ~ , i5:>Spso~fo usee:and dlsslo~~evls:.ixa~gt ae othen+~ise Nrnited in tlti~ Agreement,. Business Assod ~ktuse~ F.Wtld{~~t~ce ~ ~ 1= ,fit. §164 504Fe)(~)(i) for the proper r~ne~,and admk~l~~ t~f'tlte f~usirtiess`.Assoaate or to:-carry out the i~al re~ponsibNfttes<o1`~heBusir~ ~a~. Excerpt as #lierrn(ise 11~titsd rt this ~t^ssi'1rie~, `Bt~iris As$~date: r~a~r disclose PHI to third'pafties ~n rdar~ w~:fa.+~~:~~ ,+4~0~~~4~'~ for fibs proper mana~g~mei~# and adminon of tfie: Bu~in~s ~. ~Rs~gcJet±e~- Rimed that ~ the disdosurea~are Req~ire+~rSjt tYaw, or- fii3'5~st~te obtains reasonable assurances #rorri the personto whom t~1e infprmation~is disefcSSsd thatthe information wiN~ remain confidential and:rased'orfur#h~rdlsolosed'oniy~as requited by law o~forthe purpose fior which it vvss disdc~ed tD the`petson;,arrd #ie person. notifies the Business Assodate of any ~instatyi~a of whls~ i#. is aiware~ In -which the oonflder~tialit~ of the information. has been.b~ea~hi~. , _~ "'~ - - .. . .. .,r: ... '. ~, .. :. '.'..c .,.. 'k. , Except as .othervvlse aimited. in this ~~~ Btisi{~eosos~ste~ mart'.; use-. PHi to provide Data.r'sgatibn sarvi~ss #o ~ a~ per'mtited. ~ 42 G F.F2. §164;50~t8~~Jt~~E)= :, - '. ':~ k .. .. .. . x . ~• , Q, Businesa~Asee~ia~:a whoFn ~,provides-i~'HF rep on bghg>fi.of~G.aver~' through th~~Agreement E. Business, Associa' and in the tune ~ihd:~r~ Re~brd 9eE.L~is defiine Covered ~rttitty; fip an §154:524. ~.-8usiness~ I~ecora.Seb=~Qli' §164.52+8 at.tlte manner designs #ndividusi in orcter to meef > . ~. .. .a. SUbcont~otor, t0' ~,a cohaitions tfia~ aPPIY .::ax;#~Er>~eque~~#::of:#overad Enfity, ~~tyT~tp 'Pffi in a' Fesignated we1~ Ey:~', asdi~?ected by.~ tie. r~uirernerrts.u~cter 45 C.F.R. ultnes~~o;P~i: in a=Designated r+ai~ to. pw~suant to 45 C.F.R. :Indir~ctual s~d.,in the tithe and avv v ~rvr~ww..a.~ia~a ~. c~:. Busira+e~s A~s~lais~~~gn'~ rr~ake 1n~rnai prates;' books;,and~ re~cor~d$ relating ta'the use and:dI,osuro c~ PHI:c+ei~red'~nn; oT.cns~tied or received by Business Associate on i~ehalf ~~ ~oyere~ ~r;avaita~ia toahe. Cov+area Entity, or at t{~ei "request t~f the^Cti~rf~i~ x, $ tc~ .1e~ Sefa~Y. ~n a tune and~mianner deslgnafied by the "Ctitiaerof!~ ~e ~Il~ tQr purposes of he Secretary determining Ctw~rtt~:~i~~ :drtiple yVi~t die Piiv®cy. l~tle. kl. Business A,ssoc~te agrees Lao make. c'tit~mai: practic~s~kks;::arrd~reoar.~ds relating to thei use and:d~tr+e:of PHli+e~etvecl:#rom, o~ c:reaRed orn~ived. by . Bus'mess A~ssaiciate on beh:oft, Coygr ~; avat~ibla laaha Covered F~rtity, in a time and t~iantigr designated' ~ tl rf r - , #or . ~ of Covered ~ ,..., ...., .~ ~l. P~eeS ~Y 1. Business Ass+c~iats ~igito +~oi;~~t~°such_ disclo~sureg of PHi and' information related bo such, disc[ost'ar ae`:wd ~%uireck for Bowe F„ntity to :respond to a request by an indiwdual`fot'an. ac~Sounsng'of`dir3dtr urea of:PHi in avcordance v~itlti 45 C.F.R. § 'i64.528:. J. Business.~ssociate agrees..to pie. fa~Cover~ad~a=ntity or an Individwai,. in time and manner design~#ed. by Covet+sa y,..fia PHi in a Designated Record Set, to Covereed EnfiEy, or as dieeckec~ b~'~ C+~rad ~n~tjt, tt~ respond to a request by an. .. Individustaor an~aa~u,ntirrg.~ dlost~.rea of f'Hf in :acxordanc~e with 45 C.F.R. §164:52$: ' , I~.. Notwit~~tandistg pn~-empted. by tl P"t~y i~~r~i~ result in Go~rer~~~ntit~i,bei~~: n vip1 L. ff Business Asaocdate'conduc~s a' Covered: Eb#ity; Business Ase~'.ia~ i the Transactions "arid .Cbd~ ~'~1~i~3>i irk ~?i~ }~9~emerrt,~ Bue~n~ss A~ssc~csate: shat! 'nr~;(e~cc~-pttar tthe extenir:#~att~ey'~ra i not gl~g~an any.scr~ty that would ~n of arty. othflr stefie or:fedecai privacy law: ~t'~actioll:in whole or park fcx or on b±shaff of a~1tp~yr ail Bppiicabte requir~iertts~oF :~tit?~ any :a~ .er sub~or~tractor to _ _ _ - ~'~. ~ransa~ions~ and~Code Set Rule. N. Obiigaffons of Gove~+d~-~1'~#~fy . . A.~Covet~i. Entityu sbai~'~p~.vid~ ~i~ira ' Ty~~ wt~ th+e notice of ptivaEyr . p~ra.Ctioes.ahat~Gover~'~.p~ -~ .~ccor'~e;w.ith 45 ~.F:R. §.:'x:64:520, as wefr:es ark then t~`~irt~'t'~ , B.'±Cavered Enttfy hait~ provK#e 8usinesa ociaiae with any. changes in, or revocation ot; perrnisa~n by an individu~ao;eae gr ci PHi f: such changes affiact.Business lcte"s p~rr~ii~aid ~rp~n~ uses and disclosures:. C. Cavere~i En#i~ sMall'nt~tify`~i~d$its,A~s+~,~~e.~ an~r t~eslonao ~r® use.-or disc sure of~PHl.that.Covered Entity h~`..~o fn'a~ccordance wifh 4~ C.F.R. §'t64.57Z* if the n~stifctlon affects~Busine~soc~efia's permitfi~d;or n~quired uses and -disdosut?es. ~ ~ .. ... , b, ~Cover+ed ~ E~ity manner.. thal:v+ro4td: Entd~r, exc~pf fbr d, the Bttsit~ess Assn V. Tartu: and Tertni~tati~n ifip ~ usQ or=disclose PHt~°ih any x~y 1~~fe;ii:. done ~y Cav+ered n~.mii~tstrativo activities of A. Term: The Tenn of-this-P~f'eafirfen~'ah~ be.ye;.i aid ahalit~errnir~ate wh+st~ ~ilt~ c~~ttr~:1~~(i r+Z~dH~l ~ Cove ~4ssodabe,. ar.cxeated ~ rec~d'1~~ ~~~esa i~saodate Entity, is destibyed or retc~ne~ to Cove~¢ : , or, ;i~ it des#ray P~teeted Healtt~~ah#o'rraa~orl, ~, ; are. in arcordanoe witti tt~e aat~rr-iii'ra~i tice~t~~er~ ~n t~,~ '_ ' .... .... ;, . .._:.: ~/ .- on.behaif of Covered ~ infeasible tQ retfum or exte~ded~ to such information, won V. • ~ ` •~ ' a B. Termination for Cam. ' ~ M is ~... to imniedlafiely ter~rate~tti~S;Agree~ie~nt~ari is provide Business. Associet±a~ v~ aft ~i with Qrx 1f:B.2~. tn~the~~f~d i'i~tb'~a •~~. -- . ~nir~es~that Business ~; is n#ity may either C~ ~d agreements o~ (iil ~~~b~ach ~rt~aocordance .o this sectie~, tie 2. ~pportuMty:to cyr~i;Qptlon: ~oter~ed;Errt~y.may~~i~t:fo:notify.Bt~siness Associate of'a mafienat breach a Be~sirtess ~As~!~ia~#~'iaith.:~the~ oppoi#imityto cure~tt~t~'rei~t~~~i~il~ a$s#acton~~arrns: Provided hawever; in the event thatah±s i~ar do not a~r~ #o mutuatiy s~ed~fa~tory terms witktin ~ days; Bu$ines~ . Assvc~sshaN curo the.breach ~ the, ssittssffadtion af: e eover+ed .._..:_ >~ . E~tttXwf~hiet ~ ~ .des ~u~inese°~i~i~e~`s failure ao cuta~ a breach as set forth in this sub ' tin: is grounds ftir tie irnrnediata termin~tio'n pf this ` Agreement; and. any: oii~ir"'fi91` agreemedts: :; ..~ . C. Efitect.c~:~'e[net~o~i«~ f ... ,... ..... 1. Ratucn or D~u~or~~o~'ls~ . E~ccep! ee"p~ovidect in Sed3on UC.Z~ upon .. termination .of a#iis ~kg~~e~ fog: any redsoM,: Busir~esa Associate shall reti~m Qr destroy all PHl rec:~ived f~ocn hovered: ~ttity. or created'or recehied by Business A~sodabe on bei~alf.of m¢:En; Thls provision st~atf apply to PHI that: in the possession of subs:on#ra~ors ar _egi~ts pf Business Assp.date. Business Assadate shah retairti~ no copies Qfat7e: PHI:. ~. Fistium or: Destryctlon; nitika.:ln. #le event that Business Associate determines that ,trrjing;or destt±~y~t1~;.tha RMl is infeasible, Business Assoa shall pn3vide to: Covered ~rtflty notltica#i~~ q~ the: condi#kine that make return or destruction infeasible:: Up~in muhial a$neirt of the Patties tfiat. return or destruction. of PHi is infeas~ile; Buait~ess:Assodate shall extend the protections of this Agreement to such Pi`#t and":limlt.furt{.1er.us~ea ane disclosures of such PHl to those•purpose~s.#hat maic~e the~retUm:~ordestruction infeasible, for so long as Business Assodate rnalntaii~s such PH1. Vi. MtsceNaneous. .. a Regulatory i2efieranc~. A refer iri tthis.A~r~eme~nt to a' section in the Privacy. Rule means she ea#on as irk 'effect or as amended, and for which compliance is;regtJin~d B. intsrpretation. Any ambtgu~ty: in this Agreement Khali be resohnsd. in a favor of a meaning'that permits £overerf Entity to cxyfnply wi#h th® i?rivacy~ Rule. ~ ~~ • ~ 1 .... .. C. A~n~rrdm~int. Ths Part~a agcy to talcs s~ct1 acct a8 is neE~es58ry. to aEnend this Ag~eemen# from.tlme i~,a *q~ as ~~c+~fQ~:~twec+~d ~ti~ ~`RiY wiiti the: r~q~b~rr~rl~ a~~~~~' I'e d~ H~Jt~t i~sutaraoe ~P'or~abilt~'and. ~1txoFrr~#abilA~t, ~Eibli~ f.~i+v '~~=1~'~, ~ ~. ... -- D~~~~SynFtv~tl. ~®'~}~~ "~~.ft~brtQi~ o~;~usl~ess ASS under ~-~ ~ wr w~. ~. SBG~©t'r.V:C Of'-t~fi~~rrrir~~t $~1 ' ~~I~-~.~h® i~rml~~ati~n~:Qfthis AgI~t11@Ctt.. • . :~. EXHIBIT `B' .. JORnAN ~. CUNNIIVGHAM CUNNINGHAM & CHERNICOFF, P.C. ROBERT E. CHERMCOFF MARL W. WTT23G ATTORNEYS AT LAW BRUCE J. WARSHAWSKY P.O. BOX 60457 KELLY M. KMGHT TRACY L. [1pp>icE HARRISBURG, PENNSYLVANIA 17106-0457 TELEPHONE (717) 238-6570 FAX (717) 238-4809 HERSHEY TELEPHONE (717) 534-2833 IRS N0.23-2274135 Street Address: 2320 N. 2nd Street Harrisburg, PA 17110 Writer's Direct Email: blwQcclawoc.com January 26, 2009 VIA HAND DELIVERY Leo D. Farrell, M.D. Farrell Plastic Surgery and Laser Center, P.C. 2025 Technology Pazkway Suite 204 Mechanicsburg, PA 17050 1tE: Peter J. Sakol, M.D., LLC/Leo D. Farrell, M.D. and Farrell Plastic Surgery and Laser Center, P.C. File No: 600409 Deaz Doctor Farrell: Please be advised that I represent Peter J. Sakol, M.D., LLC ("Dr. Sakol"). For the past approximately 7 % years, Dr. Sakol has operated his medical practice under an oral cost-sharing arrangement ("Arrangement") with you and your practice at 2025 Technology Parkway, Suite 204, Mechanicsburg, Pennsylvania 17050 (the "Office"). The Arrangement has never been reduced to writing and is "at-will". Dr. Sakol hereby terminates the Arrangement effective immediately. As you are awaze, the past few weeks have been filled with tension, particulazly with respect to your discussions (they really have not been negotiations, since they have been completely one sided in your favor) about the 2009 cost sharing. However, the termination of the Arrangement by Dr. Sakol should be construed as nothing other than his pursuit of a better opportunity, one in which he has his own lease for space (the Office is currently leased only by you and he is permitted to use the facilities of the Office pursuant to the Arrangement). During the period of the Arrangement Dr. Sakol has appreciated your willingness to accept calls and refer information regazding his patients to him while he was out of the Office and he has /~ ..: CUN1vINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW Leo D. Farrell, M.D. January 23, 2409 Page 2 performed the same services for you. In all, the Arrangement has been mutually beneficial and we expect the termination of the Arrangement to be as positive and professional as the Arrangement itself. While this Arrangement has been in effect, Dr. Sakol has exhibited the highest degree of professionalism. To that end, so long as we don't have any disputes with regazd to the items set forth below, Dr. Sakol will pay you the amount owed per the Arrangement which was in effect for the calendar year 2008. That is, he will pay fifty percent (50%) of Dr. Sakol's gross collections plus or minus "take outs" for money collected for the period January 1, 2009 until January 31, 2009. He will be located in the same building as the Office and he expects and deserves that you and your staff will: 1. Inform patients and any other individuals or entities (e.g. laboratories, insurance companies) who call or contact the Office of Dr. Sakol's new address, telephone number and fax information. This information is contained on the attached sheet. The Office's Answering Service must be given Dr. Sakol's new telephone number in the event that there are emergency telephone calls for him. We will agree to pay one-third (113) of the actual costs for this service for a period of three (3) months, starting Febniaty 1, 2009; 2. Immediately forward any and all mail. While Dr. Sakol has informed the United States Postal Service about his change in address, we do not know how quickly they will process it; 3. Forwazd any and all records still in the Office relating to Dr. Sakol's practice (e.g. bills, explanation of benefits, charts) as they are discovered to Dr. Sakol; and 4. Not interfere in any way with the caze of Dr. Sakol's patients. They must be advised how Dr. Sakol may be reached. As you know, Dr. Sakol's patients aze his business relationships and we do not expect that you or anybody else acting on your behalf will interfere with his business relationships, otherwise, we will take swift legal action. Neither you nor your wife are qualified to take care of Dr. Sakol's patients as you are not ophthalmologists and Dr. Sakol's cosmetic/laserlRosacea patients are "off limits" to you or your wife. Any attempt to divert Dr. Sakol's patients to your (or your wife's) practice or refer Dr. Sakol's CUNNINGHAM & CHEKNICOFF, P.C. ATTORNEYS AT LAW Leo D. Farrell, M.D. January 23, 2009 Page 3 patients to another ophthalmologist will be construed as an intentional interference with his business relationships. We expect you to act professionally and other truthful and complete information to Dr. Sakol's patients regarding his whereabouts. While we do not anticipate any problem, you or your counsel may contact me. Very truly yows, C INGHAM & CHERNICOFF, P.C. ~. Bruce J. W hawslcy BJW/ja cc Peter Sakol. M.D. F:1Home~BJW1DOC3~3A1COL.PBTER1Genaal Buuneet~L012609.wpd CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW EFFECTIVE JANUARY 26, 2009 THROUGH FEBRUARY 16, 2009, DR SAKOL IS LOCATED AT: Peter J. Sakol, M.D., LLC 2025 Technology Pazkway Suite 209 Mechanicsburg, PA 17050 Phone: 717-791-2920 Fax 717-791-2921 EFFECTIVE FEBRUARY 16, 2009, DR SAKOL IS LOCATED AT: Peter J. Sakol, M.D., LLC 2025 Technology Pazkway Suite 205 Mechanicsburg, PA 17050 Phone: 717-791-2920 Fax 717-791-2921 EXHIBIT `C' (~ ~Gi7~~~E'iI'~2f ~ ~• Specializing in Cosmetic Plastic and Laser Surgery Leo D. Farrell, M.D. Deborab M. Farrell, M.D. Peter, Sako~ M.D. Fredricksen Outpatient Center Suite 204, 2025 Tecbno%gy Phrktvay Mecbanicrbur~ PA 1705x9497 (717) 732-9000 fax (717) 732 9011 February 12, 2009 Bruce J. Warshawsky, Esq. Cunningham & Chernicoff, P.C. P.O. Box 60457 Harrisburg, Pennsylvania 17106 RE: Peter J. Sakol, M.D., LLC. Dear Mr. Wazshawsky: The following letter is regazding the termination of Dr. Sakol with Farrell Plastic Surgery, P.C. To prevent any future disputes I would like to make you aware of the following facts: 1 • Dr. Sakol has employed 3 of our previous employees on or about January 31, 2009, including Gail Erdman, Jennifer Messick, and Rochelle Hoffinan. 2. Dr. Sakol has apparently removed patient records from my office and I assume that he has those charts under his caze and responsibility. 3. As of February 12, 2009, I have not received any amount of money for the monies collected for the period January 1, 2009 thru January 31, 2009. I expect Dr. Sakol to continue to act professionally and with confidentiality, during the establishment of his medical practice and I wish him much success. Please contact me if any of the above facts aze considered in dispute. Sincerely, Leo D. Farrell, M.D. LDF/lg cc: Peter J. Sakol, M.D. % ,~ p csurgery.com EXHIBIT `D' JORDAN n. cvNNINCxAM CUNNINGHAM & CHERNICOFF, P. C. ROBHRT 8 CHBRMCOFF MARL w wilzlc ATTORNBYS AT LAW BRVCe j. wARSxAwsxY P.O. BOX 60457 KELLY M. KMGHT 'rxAC~r L. ttPDIICH HARRISBURG, PENNSYLVANIA 17106.0457 TBLBPHONB (717) 238.6570 FAX (717)238-4809 February 17, 2009 VIA FACSIMILE: (717) 732-9011 and REGULAR MAIL Leo D. Farrell, M.D. Farrell Plastic Surgery and Laser Center, P.C. 2025 Technology Parkway Suite 204 Mechanicsburg, PA 17050 I~RSxEY ~oNE (717)531-2833 IRS NO.23-2274135 stepet Adde~eeo: 2320 N. 2nd Steve! Hareieburg, PA 17110 Wrker's Direct Email: blwQcchweec.com 1tE: Peter J. Sakol, M.D., LLC/Leo D. Farrell, M.D. and Farrell Plastic Surgery and Laser Center, P.C. File No: 600409 Dear Doctor Farrell: Receipt of your letter dated February 12, 2009 is hereby acknowledged. First, I note that your letterhead includes Dr. Sakol's name which must be corrected immediately. There should be no further communications from your office suggesting that Dr. Sakol practices at your physical location. It is also ironic that when patients have recently called for Dr. Sakol to your office, they have been advised that he is gone and that there is no forvvarding information that your office can provide. Clearly this is the type of unprofessional conduct which we had hoped could be avoided. This too must be corrected immediately, As a courtesy, another copy of Dr. Sakol's contact information is attached. Please allow me to respond to the enumerated points contained in your February 12, 2009 correspondence: 1. All three (3) employees tendered their resignations after Dr. Sakol's departure. All three (3) were hired by Dr. Sakol after they tendered their resignations to you. CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW Leo D. Farrell, M.D. February 17, 2009 Page 2 With the exception of Ms. Erdman, who had planned to tender her resignation long ago, these individuals had no knowledge about Dr. Sakol's plans prior to his actual departure. With respect to Ms. Erdman, she had advised Dr. Sakol many weeks ago that she intended to terminate her employment with you and Dr. Sakol advised her, in early January, that he did not think that financial affairs could be worked out to his satisfaction with you and that it was likely that he would be leaving as well. Their communications about his departure were very sparse and, I can assure you, there were no improprieties committed by either Dr. Sakol or Ms. Erdman in this regard. 2. All patient records which Dr. Sakol took with him were his patient charts only. None of the records which he took related to any of your patients. I also note that you described your location as "my office", but, as you know, you and Dr. Sakol were sharing the office space with separate practices. Additionally, your existing staff has brought Dr. Sakol certain patient charts which belong to him after his departure which we can only presume you authorized. 3. We are in the process of reviewing the modified December, 2008 statement in which you advised Dr. Sakol that he still owed you $217.40 and the January, 2009 statement for which you claim $10,875.07. However, the January, 2009 calculation is in error. The $150.00 item which is labeled "cosmetic income due to Sakol" was added when it should have been subtracted. Your summary also left off x44.00 for the advertisement amount for 23 days in January pursuant to your prior agreement and a prarated amount of Gail Fadman's salary for 23 days, for a total $154.32. Thus, your figure of $10,815.07 is actually $10,685.32 (correcting the $150.00 issue above and subtracting it and adding back the two (2) items set forth above). In addition to the $217.40 which we agree is owed for the month of December, 2008, the sum total due to you is $10,902.72. Additionally, there were $1,625.74 in collections from January 26, 2009 through January 30, 2009 (for work performed prior to Dr. Sakol's departure). From this figure, the sum of $441.24 for reimbursement of medical botox for which Dr. Sakol had already previously paid you yields a net amount collected during the last week of January of S 1,184.50. Fifty pcrccnt (50.0) of this amount is due to you in the amount of $592.25. Since Ms. Erdman had to spend approximately seven (7) hours to collect and post the aforementioned monies which were paid in CUNIVINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW Leo D. Farrell, M.D. February 17, 2009 Page 3 the last week of January, her salary for this period of time ($148.75, which should have been a cost you absorbed through the use of your own staff), has been subtracted. Thus, Dr. Sakol owes you an additional $443.50 making the total 511,346.22. I have instructed Dr. Sakol to pay this amount to my escrow account immediately. However, insofar as your otl;ice has been advising patients that Dr. Sakol's whereabouts is unknown and because we have significant concerns that either you or your wife are diverting Dr. Sakol's patients for procedures', we will hold the money in escrow until such time as we have an agreement in place which requires your staff to advise Dr. Sakol's patients of the location of his new ofFice and how to contact him and that you will agree not to perform procedures on Dr. Sakol's patients for a specified period of time. Your attention to this matter is greatly appreciated. very truly yours, GHAM 8t CHERNICOFF, P.C. .~ Bruce J. W wsky BJwra cc Peter Sakol. M.D. e:~t~.~a~vv~nocs~sNCOt.rsreRw.~.i e~w~coi~~.~a which we have confirmed did occur at least on occasion in early February CLIIVNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW EFFECTIVE FEBRUARY 19, 2009, DR SAKOL IS LOCATED AT: Peter J. Sakol, M.D., LLC 2025 Technology Parkway Suite 205 - (in the interim, located in Suite 209) Mechanicsburg, PA 17050 Phone: 717-791-2920 Fax 717-791-2921 EXHIBIT `E' Bruce J. Warshawsky, Esq. Cunningham & Chernicoff, P.C. Attorneys At Law P.O. Box 60457 Harrisburg, Pennsylvania 17106 RE: Peter J. Sakol, M.D., LLC Dear Mr. Warshawsky: In response to your letter dated February 17, 2009 I believe the following is true. 1. Dr. Sakol's name has been removed from our letterhead and no correspondence from my office will include his name in the future. 2. I have distributed your letter dated February 17, 2009 to all my staff so there is no misunderstanding of my intentions. In my presence, my receptionists have informed patients both on the phone and in person of the exact location where Dr. Sakol can be found. 3. Ms. Erdman never tendered her resignation to me. I appreciate your acknowledgement of her voluntary resignation, which I will use as proof in the event of any unemployment claims. 4. Jen Messick and Rochelle Hoffman both presented letters of resignation effective February 2, 2009. Both then decided to terminate employment earlier and verbally acknowledged they were offered positions with Dr. Sakol immediately. They also acknowledged that they had extensive discussions with Ms. Erdman which I can only assumed was condoned by Dr. Sokol. 5. Dr. Sakol never signed any lease agreement with Pinnacle Health and never accepted any responsibility for the lease term. So, I do believe my location is best described as "my office". 6. I expect Dr. Sokol to forward a check to me for the monies owed to Farrell Plastic Surgery, P.C. by March 2, 2009.Otherwise, I would be forced to take legal action regarding his lack of concern for the collection of over $250,000 of accounts receivable extending back to 2007, and the manipulation of his practice during the prolonged arbitration with his auto insurance company, which I can only assume was to support his claim of loss of compensation due to his accident 7 years ago. Yours truly, Leo D. Farrell, M.D LDFJIg EXHIBIT `F' ..r 1°RD'~ °• ~~~"M CUNNINGHAM & CHERNICGFF, P.C. ROBBRr B. Q~IBRMCOFP MARL w wlTZlc ~ ATTORNEYS AT LAW BRVCa ). wARSxAwslor P.O. BOX 60457 KELLY ~ ~~ HARRISBURG, PENNSYLVANIA 17106-0457 TRACY L. L-PDIICB TBLSPHONB (717)238.6570 FAX (?17) ?364809 February 18, 2009 VIA FACSIMILE: (717) 732-9011 and REGULAR MAIL Leo D. Farrell, M.D. Farrell Plastic Surgery and Laser Center, P.C. 2025 Technolo~+ Parkway Suite 204 Mechanicsburg, PA 17050 I~RSi~r •rBr.~xoM (717)534-2833 IRS NO.23-2274135 sr~eet Aaa~e: 2320 N. 2nd Street Harriebnrg, PA 17110 Writer's Direct Email: 61wCalcclawtu.com RE: Peter J. Sakol, M.D., LLC/Leo D. Farrell, M.D. and Farrell Plastic Surgery and Laser Center, P.C. File No: 600409 Dear Doctor Farrell: Thank you for your facsimile which I received yesterday at 4:35 p.m. and which responds to my letter dated February 17, 2009 faxed to your office earlier in the day. It is obvious that there are facts in dispute with respect to Dr. Sakol's departure and the events which have transpired since, to date, Nonetheless, it is imperative that you and Dr. Sakol execute an Settlement Agreement and Mutual Release to allow both of you to move on with your professional lives. I will draft that Settlement Agreement and Mutual Release for your consideration by no later than February 23, 2009 and expect that it will executed and payment made to you in accordance with the calculations contained in my February 17, 2009 correspondence by no later than March 2, 2009. If you wish, I will send a draft of the Settlement Agreement and Mutual Release to your counsel. If I do not hear from you by noon, February 23, 2009, I will forward the document directly to you. •~~~ CUNNINGHAM & CFiERNICOFF, P.C. ATTORNEYS AT LAW Leo D. Farrell, M.D. February 18, 2009 Page 2 One matter which is of grave concern to Dr. Sakol is the defamatory statements contained in Paragraph 6 of your February 17, 2009 facsimile. These statements are patently false and constitute defamation per se. Dr. Sakol has also been advised by certainthird-parties (unsolicited, that is, they contacted him) that you have been communicating misinformation about the termination of your business relationship. This misinformation may also be actionable in defamation. Therefore, the Settlement Agreement and Mutual Release shall contain strict confidentiality provisions and representations that the parties have kept the circumstances relating to the termination of your business relationship and the terms and conditions of the Settlement Agreement and Mutual Release confidential beginning today, February 18, 2009. I have instructed Dr. Sakol regarding his responsibility for confidentiality and by virtue of the receipt of this cornspondence, you are similarly instructed Please be guided accordingly. Very truly yours, C GHAM 8t CHEIt1~1ICOFF, P.C. ~~ Bruce J. W wsky BJWra cc Peter Sakol. M.D. F:~tiom~B1W100091SAKOL.PBTEAW~n~nl BwinwllA2IB09.wpd EXHIBIT `G' i tEB-18-2009(YEO) 17:12 FRRRELL PLRSTIC SUR6ERy (FAX)7177329011 I P. 001 /00 ' Farrell ~'lastic Surgery ~ ,user Center, ~". ~ , 2025 'xechaology Parkvv~ay, Suite 204 Mechanicsburg, PA 17050 (71'~ 732-9000 (717) 732-90I 1 FAX ~tANS1VI~SSIQN ~ 3~~4~u5 F,i~c Nambp Ta: j~~1,tJ C ~. l~'ron: ~ ~ L~ lea: (inctudfn8 covcr a6eet) ua~r~stf~ws k y . f's~ . ~~.~~~1~ IFyou do not reccivc t]u indicated pages, please call our office at (7l ~ 732-9000 Mcaaaga ~~.Q.~.c.! . ,~ da t=. ~,~v a ~' ,g~. ~ ~+ ~ c ~G ~.7 /H A•n~. c /~- 2 / ~.c,c.- S ~v I fiCbv t- cl.e of ~ ~~/-,~~ /moo r- ,q„~~ w orb 7~ ~ls ~=~rh. n•~ .q.~~ ,~.~,~~ ~Yw~w>7 ~. c~P y ~F ~ ~.~~-l. ~.~~-- f~'^g ra,..n„~ erg' ~.U ~~~N~'1e~.. /Z,.o~ er ~ ~~ ~ . S~/aft, ~¢+vD~rtJorv ~'~ Smocks ~ ~~~? r ~1• fCa..,rt" f Healthcare Iatbrmaeim la personal and saashive infeea>at[oo, u is befog S~o~ed to you s8ar appropriate amborlsetioa flnm the yatiwt a under cir~pp~a dart do not requite psdent atrthori~ao. You, the recipirut, are obggated oe it 3a a saPo~ and caolidentist . Re-dtscloe<~re wttlsouc additional patleot camp oc ss pernriticd by law is prohibited. Uorized te~disclostte+s a llt;lta+e to '~~ ~tY could ~~ Y'~ ~ P~~ 1~ lbderal and s~ law The Inilotmmtion oootataed in this fltcsimile message L pdvato~ canfldeatW. sod Prtvileaed lnfamation and is inbandM aaly for the uee of the individual or penca(s) mined oa this traostnadoit sheen, Ifyou receive this message is ecrac, please oodQr our oflla immediaaely by oekphone as we can make arrmgeme>rts for the rehtla ot'the vrigloal doanemnts. EXHIBIT `H' Bruce J. Warshawsky From: Bruce J. Warshawsky Sent: Wednesday, February 25, 2009 9:16 AM To: Heather D. Royer (E-mail) Cc: Bruce J. Warshawsky Subject: draft of release in Word per your request is attached Importance: High releaseflnal.doc Bruce J. Warshawsky, Esq. Cunningham & Chemicoff, P.C. 2320 N. Second St. Harrisburg, PA 17110 717-238-6570 717-238-4809 (Fax) CONFIDENTIALITY NOTICE: This email contains information from the law firm of Cunningham 8c Chernicoff, P.C., which is confidential and/or legally privileged. If you are not the intended recipient, you are notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Please notify us immediately if you receive this transmission in error. Thank you. Tracking: Recipient Read Heather D. Royer (E-mail) Bruce J. Warshawsky Read: 2/25/2009 9:17 AM CONFIDENTIAL SETTLEMENT AGREEMENT AND MUTUAL RELEASE This is a Confidential Settlement Agreement and Mutual Release ("Agreement") by and between Leo Farrell, M.D. and Farrell Plastic Surgery and Laser Center, P.C. (hereinafter referred to as "Dr. Farrell") and Peter J. Sakol, M.D. and Peter J. Sakol, M.D., LLC (hereinafter referred to as "Dr. Sakol") WHEREAS, Dr. Farrell and Dr. Sakol were engaged in a cost and revenue sharing relationship for their respective medical practices; (the "Relationship") which was severed when Dr. Sakol moved his practice at the close of business on January 23, 2009; and WHEREAS, Dr. Farrell claims that Dr. Sakol owes Dr. Farrell money in connection with the Relationship and various issues have arisen during the Relationship and since its termination that has created a dispute by and between Dr Farrell and Dr. Sakol (the "Dispute"); WHEREAS, the parties hereto, desiring to avoid the expense of litigation, have agreed to resolve the Dispute and all matters arising out of the Relationship. NOW, THEREFORE, for the consideration contained herein, the receipt and sufficiency of which is hereby acknowledged, the parties hereby agree as follows: 1. Consideration Dr. Sakol agrees to pay and Dr. Farrell agrees to receive, Eleven Thousand Four Hundred Ninety-Four and Ninety-Seven Cents ($11,494.97) in full settlement of the Dispute and all matters and disputes arising out of the Relationship. 2. Complete Mutual Release a. This Agreement provides for a Release which includes, but is not limited to, all claims which were or could have been brought in connection with the Relationship. b. Dr. Farrell, for itself, its affiliated and related companies, officers, directors, insurers, successors, and assigns, hereby agrees to forever waive, release, and discharge Dr. Sakol from any and all claims, causes of action, and lawsuits, including but not limited to any claim that Dr. Farrell could have asserted arising out of the Relationship, of any type whatsoever arising prior to the time of execution of this Agreement, whether known or unknown; and all rights and duties, obligations, debts, liabilities, damages, injuries, expenses, actions or causes of action and suits of every kind and nature, contingent or actual, liquidated or unliquidated, in connection with the Relationship, provided, however, that nothing herein shall be construed to release any obligations or undertakings pursuant to this Agreement. c. Dr. Sakol, for itself, its affiliated and related companies, its officers, and directors, insurers, successors, and assigns, hereby agree to forever waive, release, and discharge Dr. Farrell from any and all claims, causes of action, and lawsuits, including but not limited to any claims that they could have asserted arising out of the Relationship, of any type whatsoever arising prior to the time of execution of this Agreement; and all rights and duties, obligations, debts, liabilities, damages, injuries, expenses, actions or causes of action and suits of every kind and nature, contingent or actual, liquidated or unliquidated, in connection with the Relationship; provided, however, that nothing herein shall be construed to release any obligations or undertakings pursuant to this Agreement. 3. No Admission of Liability The parties, and each of them, agree that this Agreement is made in compromise of disputed claims and to avoid the expense and inconvenience of litigation and is not, and is not to be construed as, a finding or admission of wrongdoing, or illegal, immoral or unethical conduct by any party. 4. Confidentiality and Non Dispaza ement a. Dr. Farrell and its counsel and Dr. Sakol and its counsel (i) state that since February 18, 2009 and (ii) henceforth they agree they shall keep strictly confidential, and shall not reveal, publish, communicate or otherwise disseminate to any other person or entity., the existence, terms and conditions of this Confidential Settlement Agreement and Mutual Release including without limitation, any and all matters relative to the Relationship, except as required by law or as required by any insurance company requirement with respect to billing and claims only, or the amount of the payment to be made to Dr. Farrell, except that Dr. Sakol shall not be precluded from communicating the amount of the payment to any federal, state or local taxing authorities or to any tax accountant or tax prepazer, provided that such accountant or prepazer agrees to keep such information confidential, except called with respect to such taxing authorities. b. Neither Party shall publicly or privately disparage the other or make or publish any statement (orally or in writing) to any person or entity which would libel, slander, disparage or defame the goodwill or the reputation of the other (whether or not such disparagement legally constitutes libel or slander). c. The Parties recognize that irrepazable injury will result in the event of any breach or threatened breach of this Confidentiality and Non- Dispazagement Provision; therefore, they agree that in addition to any _ _ monetary damages or other remedies available, at law, the non-breaching party shall be entitled to equitable relief in the form of a temporary restraining order, a temporary or permanent injunction to restrain the threatened violation or actual violation of this provision together with the reasonable attorney fees and costs incurred by the non-breaching party in the successful enforcement of this Confidentiality and Non-Dispazagement Provision. In the event the party which is alleged to have breached this Confidentiality and Non-Dispazagement Provision successfully defends such an allegation, that party shall be entitled to recover its reasonable attorney fees and costs incurred. 5. Choice of Law. The parties agree that this Confidential Settlement Agreement and Mutual Release shall be governed by, and construed pursuant to the substantive laws of Pennsylvania, and shall be exclusively enforced by the courts of the Commonwealth of Pennsylvania with exclusive venue in Cumberland County, Pennsylvania. 6. Agreement Freely and Voluntarily Entered Into a. Dr. Farrell hereby warrants that it has signed this Agreement only after review and consultation with its counsel, Heather Royer, Esquire, who has represented it, that counsel has explained the terms of this Agreement, it has had a reasonable time within which to consider the settlement, and that it understands this Agreement and signs it freely, knowingly and voluntarily, without any legal reservation, duress, coercion or undue influence, and fully intending to be legally bound hereby. b. Dr. Sakol hereby warrants that it has signed this Agreement only after review and consultation with its counsel, Bruce J. Warshawsky, Esquire, who has represented it, that counsel has explained the terms of this Agreement, it has had a reasonable time within which to consider the settlement, and that it understands this Agreement and signs it freely, knowingly and voluntarily, without any legal reservation, duress, coercion or undue influence, and fully intending to be legally bound hereby. 7. Complete Agreement This Confidential Settlement Agreement and Mutual Release embodies the full, entire and sole agreement of the parties hereto and that regardless of the adequacy or inadequacy of the amount paid, it is intended to avoid litigation and to be final and complete. No modifications to this Confidential Settlement Agreement and Mutual Release shall be of any force or effect unless in writing and signed by the parties to this Agreement. IN WITNESS WHEREOF, INTENDING TO BE LEGALLY BOUND HEREBY, THE PARTIES BELOW HAVE EXECUTED THIS CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE AS OF THE DATES SET FORTH BELOW: Witness LEO FARRELL, M.D. Dated: , 2009 Dated: _ , 2009 Witness FARRELL PLASTIC SURGERY AND LASER CENTER, P.C. Dated: , 2009 Dated:. .2009 IN WITNESS WHEREOF, INTENDING TO BE LEGALLY BOUND HEREBY, THE PARTIES BELOW HAVE EXECUTED THIS CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE AS OF THE DATES SET FORTH BELOW: Witness: PETER J. SAKOL, M.D. By: Dated: , 2009 Dated: , 2009 Witness: PETER J. SAKOL, M.D., LLC By: Dated: , 2009 Dated: , 2009 F:Wome\BJW\DOCS4SAKOL.PETER\General Businesslreleasefinal.wpd EXHIBIT `I' Bruce J. Warshawsky From: Bruce J. Warshawsky Sent: Tuesday, February 24, 200910:27 AM To: Heather D. Royer (E-mail) Cc: Peter Sakol (E-mail); Bruce J. Warshawsky Subject: update Heather. I know you just met with Dr. Farrell yesterday and want to update you on a few matters. He wants the situation resolved with a payment by Monday and I have the $$ in escrow if we can get it done. Apparently, his website needs to be revised to remove references to Dr. Sakol. We can give him a reasonable period of time to do it under the agreement, maybe a week, and if he starts the process now, it is achievable. Another incident occurred yesterday when a patient inadvertently went to Dr. Farreil's ofc for an appt. w/Dr. Sakol. The woman in front was rude and told the patient that she had no idea where Dr. Sakol could be found. The Rx issue should be resolved. Dr. Sakol has his own pads and has been using them, but there are still some old scrips out there and pharmacists haven't caught the change, so out of force of habit, they are making the mistakes. We are doing our best to correct the situation. Also, the Patriot ad snafu was unfortunate, but entirely not Dr. Sakoi's fault. Again, we are taking corrective steps. We really need to do our best to get this business relationship severed neatly. Bruce J. Warshawsky, Esq. Cunningham 8 Chemicoff, P.C. 2320 N. Second St. Harrisburg, PA 17110 717-238-6570 717-238-4809 (Fax) CONFIDENTIALITY NOTICE: This email contains information from the law firm of Cunningham & Chernicoff, P.C., which is confidential and/or legally privileged. If you are not the intended recipient, you are notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Please notify us immediately if you receive this transmission in error. Thank you. EXHIBTT `J' John W. Purcell, Jr., Esquire ID #29955 Purcell, Krug & Haller 1719 North Front Street Harrisburg, PA 17102 (717) 234-4178 jpurcell(~pkh.com FARRELL PLASTIC SURGERY & LASER CENTER, P.C., Plaintiff v. GAIL ERDMAN, Defendant IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA N0.09-7616 CIVIL TERM CIVIL ACTION -LAW DEFENDANT'S ANSWER TO COMPLAINT WITH NEW MATTER AND NOW, comes the Defendant, Gail Erdman, by her attorneys, Purcell, Krug 8 Haller, who file the following in answer to Plaintiffs Complaint: A. Parties 1. Admitted. 2. Admitted. B. Jurisdiction and Venue 3. Denied as a conclusion of law. 4. Denied as a conclusion of law. C. Factual Background 5. Admitted. In further reply, Defendant was employed by the Plaintiff for a longer period of time than that which is set forth herein. 6. Denied as stated. To the contrary, as an ofFce manager, Defendant was responsible to manage the staff and the office, who, in turn, were responsible for checking patients out after procedures, collecting payments from patients, and making daily deposits. Other employees were responsible for those matters. As office manager she was responsible for preparing accounting reports. However, as office manager, on occasion, she would assist staff with some of the other duties. 7. Admitted in part. Denied in part. It was admitted that at the end of the day, Defendant was required to prepare a payment report. It is denied that she was responsible for making deposits. S. Denied. As office manager, Defendant believes she had the authority to give discounts in an effort to ensure timely payments from patients, as discounts were often granted to patients for various reasons, including the receipt of cash payments. Many patients paid in cash, with our without discount. 9. Denied. Defendant is without knowledge or Information sufficient to form a belief as to the truth or falsity of the averments contained in this paragraph, and strict proof thereof is demanded at trial. In further response, this allegation is also a conclusion of law. 10. Denied. The daily payment reports could not be altered. 11. Denied as a conclusion of law. The allegation contained in this paragraph is vague and over broad, and all the records are in the possession of the Plaintiff, so the Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averment, and strict proof thereof is demand at trial. 2 12. Denied as a conclusion of law. In further reply, the Defendant did not intentionally and fraudulently use her position as office manager to intentionally convert $54,434.97 from the Plaintiff for her own personal use. COUNTI Conversion 13. No response required. 14. Denied as a conclusion of law and as more fully set forth above. 15. Denied. Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averment, as the records are all in the possession of the Plaintiff. Strict proof thereof is demanded at trial. WHEREFORE, Defendant respectfully requests this Honorable Court to enter judgment in favor of the Defendant and dismiss the Complaint. COUNT II Fraud 16. No response required. 17. Denied as conclusions of law. In further reply, Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averments, as all records are in the possession of the Plaintiff. Strict proof thereof is demanded at trial. j 18. Denied. Defendant made no representations, and the matter is denied as i j conclusions of law. 19. Denied. Defendant made no representation, therefore, the matter is denied as conclusions of law. 20. Denied as a conclusion of law. 3 21. Denied, Defendant is without knowledge or information sufficient to form a belief as to the truth or falsity of the averment, and strict proof thereof is demanded at trial. WHEREFORE, Defendant requests this honorable Court to enter judgment in favor of the Defendant and dismiss the Complaint. NEW MATTER 22. Defendant worked in the office of the Plaintiff for approximately 8 years. 23. During that time period, Defendant became aware that Dr. Farrell was perpetrating fraud upon various insurance companies, by representing that he was performing various procedures on patients when in fact others who were not accredited with the insurance companies to pertorm those procedures were actually performing them, primarily his wife. 24. At least on one occasion he requested that the Defendant participate in altering records in anticipation of an insurance audit. 25. Defendant refused to be a part of that, and instead other employees of his office were directed to make the alterations at his direction. 26. Defendant believes and therefore avers that Plaintiff is under investigation for insurance fraud, and that part of his motivation for making the claims set forth in his complaint are to affect the anticipated future testimony of the Defendant. 27. More than one employee of the Plaintiff had access to the books and records of the Plaintiff during the time period in question, including Dr. Farrell himself. 28. The facts giving rise to Plaintiff's complaint could have been caused by people other than the Defendant, including Dr. Farrell himself. 4 29. Plaintiffs claims are barred in whole or in part by the doctrine of unclean hands. 30. Plaintiffs claims are barred in whole or in part by the applicable statute of limitations andJor lathes. 31. Plaintiff has failed to state a cause of action against the Defendant. WHEREFORE, Defendant requests this honorable Court to enter judgment in favor of the Defendant and dismiss the Complaint. PURCELL~ KRU(3 ~ HALLER ey: uonn w. rr., Esquire 55 1719 North Front Street Harrisburg, PA 17102 (717) 234-4178 DATE: >~ - / 7 - o ~' Attorney for Defendant 5 VERIFICATION I verb. that the statements made in the foregoing ANSWER TO coMPLAINT .WITH NEW MATTER are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C. S X4904 relating to unsworn falsecation to authorities. Date: I ~ ~ ~ ~ ~~ _ '' ~ CERTIFICATE OF SERVICE I, Kimberly S. DeFalco, Legal Assistant to John W. Purcell, Jr., hereby certify that a true and correct copy of the foregoing document was served upon the Plaintiff, by sending a copy of the same via first class U.S. Mail to: Peter M. Good, Esquire Jessica E. Mercy, Esquire Smigel, Anderson 8 Sachs, LLP 4431 North Front Street Harrisburg, PA 17110-1778 Kimberly S. DeF co, egal Assistant to John W. Purcell, ., squire PURCELL, KRUG 8 HALLER I.D. No. 29955 DATE: ~~~ ~~ t (~~ ., ~ ~ J ~F ~; , . ,~ 1009 OCC t 8 Pri 3~ 3 0 .~.~.~ l . t... i. { i-;~, t EXHIBIT `K' i ~~~, ~; ~~~~~~ Leo D. Famll, M.D. Suin 204, 2025 Tub~ology Par,Eare~ Deborah M. Famll, M.D. Mabanrcrbur~ PA 17050-9497 (717) 732-9000 fax (717) 732-9011 Dear Friend: We are contacting you to make you aware of our amazing technology. Our Candela Vbeam Perfecta Laser is the gold standard for treatment of vascular skin conditions, such as Rosacea. It is a pulsed dye laser which has a 20-year proven tract record of safety, reliability, and efficacy for treatment of a wide range of vascular skin conditions. We are Central Pennsylvania's most eztensive on-site laser center with over ten laser and light based technologies. We offer state of the art laser treatment for numerous skin conditions including: ~ Diffuse Redness • Red Spots • Rosacea • Skin rejuvenation • Wrinkles • Port wine stains • Facial spider veins • Hemangiomas • Freckles • Pigmentation • Laser hair removal • Tattoo removal • Age spots • Acne • Leg Spider veins You can choose the laser treatment that is ideal for you! Please call Farrell Laser and Cosmetic Medicine Center at 732-9000 to schedule your consultation and treatment. *** All treatments are performed by a physician. *** ~~ r ~:~ 4~.1 tL'I °~I W fly =. =- a H H a ~~ o a~ Q~s (c~ b ~l v .~ .~ ~. ~ ~i ~~ ~~~ ~i:~ ~ . ~ .: - EXHIBIT `L' r M 1 JORDAN D. CUNNWGHAM ROBERT E. CHERNICOFF MARC W. WITZIG BRUCE J. WARSHAWSKY KELLY M. KNIGHT TRACY L. UPDIKE CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW P.O. BOX 60457 HARRISBURG, PENNSYLVANIA 17106-0457 HERSHEY TELEPHONE (717)534-2833 TELEPHONE (717) 238-6570 FAX (717)238-4809 September 3, 2009 HAND DELIVERY Heather D. Royer, Esquire Smigel, Anderson 8t Sacks LLP 4431 North Front Street Harrisburg, PA 17110 IRS N0.23-2274135 Street Address: 2320 N. 2nd Street Harrisburg, PA 17110 Writer's Direct Email: biwCa~cclawoc.com RE: Peter J. Sakol, M.D., LLC V. and Farrell Plastic Surgery and Laser Center, P.C. Cumberland County No: 09-6023 File No: 600409 Dear Heather: Thank you for your voice mail and email of September 2, 2009. The BAA is terminated. The PHI (as defined in the BAA) must be destroyed. We are prepared to litigate to enjoin and require your client to destroy my client's PHI. If your client destroys my client's PHI, we are prepared to sign the Settlement Agreement (this statement is, of course, made for settlement purposes only and may not be used in any litigation), and all matters by and between our respective clients could be finally and fully resolved. At this juncture, we have filed suit and intend to address any and all claims against your client including, but not limited to, a Declazation Judgment Action on the BAA and a Declazation Heather D. Royer, Esquire September 3, 2009 Page 2 CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW Judgment Action on the oral business "relationship". I enclose herewith a Praecipe for Writ of Summons, Writ of Summons and Acceptance of Service. Please kindly return the Acceptance of Service at your earliest convenience. Thank you. BJW/ja Enclosure cc Peter Sakol. M.D. F:U{omelB.iW1DOCSV4AKOL.PE7ER\Geaenl Buuneu1L090309.wpd Very truly yours, C GHAM & CHERNICOFF, P.C. ~~ Bruce J. War awsky EXHIBIT `M' JoRnAN v. cuNNnvcHANI CUNNINGHAM & CHERNICOFF, P.C. ROBERT E. CHERNICOFF MARL w wrrztc ATTORNEYS AT LAW i3RUCE j. wARSHAwsKY P.O. BOX 60457 KELLY M. KNIGHT HARRISBURG, PENNSYLVANIA 17106-0457 TRACY L. LII'D1KE TELEPHONE (717)238-6570 FAX (717) 238-4809 September 10, 2009 VIA FACSIMILE: (717) 234-3611 and REGULAR MAIL Heather D, Royer, Esquire Snligel, Anderson & Sacks LLP 4431 North Front Street Harrisburg, PA 17110 HERSHEY TELEPHONE (717) 534-2833 IRS N0.23-2274135 Street Address: 2320 N. 2nd Street Harrisburg, PA 17110 Writer's Direct Email: biw aC~cclawoc.com RE: Peter J. Sakol, M.D., LLC V. and Farrell Plastic Surgery and Laser Center, P.C. Cumberland County No: 09-6023 File No: 600409 Dear Heather: A rather disturbing development has occurred. Attached herewith, you will find a "targeted" mailing which your client sent to various individuals (on or about September 1, 2009 -see postmark). Certain of these individuals were my client's patients who previously received Rosacea treatments.' My client has confirmed with other patients (who have never received Rosacea treatments) that they never received such a mailing from your client. The only explanation for this situation is that your client, again, utilized my client's PHI (as such term is defined in the BAA) for an unlawful purpose. I will presume that you had no knowledge of this matter because your email to me dated September 2, 2009, emphatically states that your client "has and will continue to abide by his HIPPA obligations". ' The name on the envelope has been withheld to protect the privacy of the individual who provided Dr. Sakol with a copy of said mailing. Heather D. Royer, Esquire September 10, 2009 Page 2 CUNNINGHAM & CHERNICOFF, P.C. ATTORNEYS AT LAW My client has been advised that certain of the recipients of your client's targeted mailer . may file HIPPA Complaints. Again, I reiterate that the BAA is terminated and my client's PHI must be destroyed. At this juncture, my client no longer has any interest in executing the Settlement Agreement. Please kindly return the Acceptance of Service that was provided to you so that same may be filed with the Court. Very truly yours, BJW/ja Enclosure cc Peter Sakol. M.D. F:\Flome~BJW1DOC3\SAKOL.PETER\General BusineatU.091009.wpd OHAM' & CHERIVICOFF, P.C. • ~'V Bruce J. W shawsky $~ N .~ s" "~ ,. -• ~ ~~ ~~ ~~ ~~ .~ ~.. r 0 ~~ ~~ v ~: ~• "'~:~ x• +. .R .~ S' • r Lse D. Fart!/, M.A Swat 204, 20If Tkr per Drbonrb M. Aarrl~ 11~D. M~ p,4170f0-9497 (71 ~ 732-9000 funs (717) 732-9011 Dear Friend: We are contacting you to make you aware of our amazing technology. Our Candela Vbeam Perfecta Laser is the gold standard foot t of vascular skin conditions, such as Rosacea. It is a pulsed dye laser which has a 20-year proven tract record of safety, roliability, and ei$cacy far treatment of a wide sage of vascular skin conditions. We are Central Pennrylvania's most eitensivo on-dte laser center with over ten laser snd ligltt based technologies. We offer state of the art laser treatment for numerous skin conditions including: • Di~se Redness • Red Spots • Rosacea • Skin rejuvenation • wrinkles • Port wine stains • Facial spider veins • Hememgiomas • Freckles • Pigmentation • Laser hair removal • Tattoo removal • Age spots • Acne • Leg Spider veins You can choose the leer treatment that is ideal for you! Please call Farrell Laser and Cosmetic Medicine Cmtar at 732-9000 to schedule your consultation and treatment. *** All treatments are performed by a physician. *** ~m f+~rrisJbndc+~x EXHIBIT `N' ~' ~ ,~ Please Take Notice to Oar New Address, Phone & Faa Numbers 'Va Uey p'orge Corporate Center ~ 27p0 Vasa ~ure~a ,A,ve.i Eagleville, PA ]9403 Computer Sorvico: Inc.. ;;~~~' r~~. ~? ~~~~ ~~~ ,,tee rwr ~rh ~•Ii I'~,~~wl w~ hy~i' M~JI•. ~. A ~ri~~J+' J J To: Hrace Sublect: Phone: Fns Phons: 717-?3$-4809 Wob Situ: www.~ticomputorcom Hate: 10/20/09 Number of pages iacladiag cover sheet: ~ From: Vlnce B.apoaito Department: Customer Support CC: ' Phone: 610650-9700 p'es Phone: 9apQortFsx: 610-650-9275 REMARK:: ^ UrIIeitt ® Tor ycria review ^ Reply ASAP SrnCe Warsb aW8lcy, Sere t~ a copy olthe e-mafl I gent to yon. Thsnlta, ~~~ ~ Customer sapp ort Mgr 877 cornpuar a.ti+e... Ino .-, ^ Please co~m®tnt Tg1~1# wn.n ...++n •www ++w w.~wwwww+w .•••• w..... -.•- ~-- f ,~, Vince Esposito From: Vince f`sposi~ [Vespositot~st<computer.com] Sent: Friday, October 1®. 2008 3:46 PM To: 'ajwt~cdawpo.com' Subject: Dr Sokol Bruce, Below is a description of the procedures that would need to be performed on tha database at DR. Farrelis's ofNce in order to remove tF~e data that you wish to remove. 'T'he cost to do this should not exceed SZ5Q0 barring any unforeseen complications. Removal of Practice Qata from the database present at Farrell Plastic Surgery. Dr Sokol was billini; under Practice 2 Remove all finanti 31 data associated with Practice 2 (ie: charges, payments, etc.) Remove all Appoir tmtnt data associated with Practice 2 Remove all Patient s demographics attached solely to Practice Z - if a patient was also seen by practice 1, that patient's demographics and insurance data would remain intact. Alt reference files ~ ie: insurance tables, procedures, diagnosis, etc) will remain intact in the database. Thanks, Vince i:sposito Customer Support Manager STI ComputerServites, Inc. Z00 ®I SEAS 13~Ltldl[0~ I.LS 91Z80Q90T9 YV3 90 ~ ZO 6002/OZ/Ot EXHIBIT `O' Ik`ti1 ~~y w.SiVr' ~~ .,~S,N ' .~~ ti~~~. ~, ' '~ A` ~.1 . • ~ ,, '~ ' .~ ' ,..~, p ~ . ~q~. I :~ I '~~ . I 's ~. . '~ ~ ~ ~, r , Srd. ~ 4; Ali ~ ,~ I I~ ,~ tt ~' ~ ~ ~ ~ ~ ~ ~ i ~ a ~ d ~~ a ~ ~ - ~ `~ ~ ~ ~ ~s ~ ~; ~s ~. ~ c d~ H a H H 7d ~ii~~~ a EXHIBIT `P' ,, ... Airrz HF.AY.~rx law wrrotuva~ ~r taw 300 NOSH 1~IDtD SrRBBr 13th P1.00~, SU1181T.B )EiARR19BURC, PA 17101 (?1T) 238r990~ FAX (71?) 338~Z443 (exits I. Anri, Esa. eia~artrheal~fdaw.com December 18, 2009 VIA FACSIMILE (2343611) AND U.S. MAIL Peter Good, Esq. Smigel, Anderson & Sacks, LLP 4431 North Front Street Harrisburg, PA 17110 Re: Farrell v. Sakol No. 2009-CV-1 SS56 Dear Peter: ~~~Y This responds to your letter dated December 10, 2009 regarding the above referenced matter. With respect to the second paragraph in your letter, you again assert that it is infeasible for Farrell Plastic Surgery to destroy any records at the current time. In my October 26, 20091etter to you, I identified the common usage definition of infeasible (unworkable and not subject to reasonable likelihood of success); identified all of the reasons why destruction of Dr. Sakol's ePHI was not infeasible, i. e. it is quite feasible; and respectfully suggested that infeasibility is not equivalent to reluctance or disdain for a legal obligation. Our litigation team has learned that it is not imperative that the data remain on the original computer server or system, and that appropriate measures can be taken to destroy Dr. Sakol's ePHI. We are proceeding with the litigation and present this letter, which also incorporates by reference my October 26, 20091etter, as a Rule 1023.1 notice to Dr. Farrell and Farrell Plastic Surgery. Please explain the implications of paying all of Dr. Sakol's attorneys' fees because we will prove that the position taken with respect to infeasibility lacks any reasonable foundation in fact or in law, and that it is being~proffered for an improper purpose. From this moment, Farrell Plastic v Peter Good, Esq. December 18, 2009 Page 2 Surgery and Dr. Farrell will be held responsible for all legal fees incurred in the litigation attempting to secure destruction of Dr. Sakol's ePHI. As you know, on December 16, 2009, my co-counsel Bruce Warshawsky extended an offer to mediate this dispute under the Dauphin County Bar Association Alternative Dispute Resolution Program (as you know, Dauphin County Local Ruies require the parties to consider same in good faith), Any efforts in this regard shall be an exception to any attorney fee shifting application, both as a demonstration of ow continued good faith approach to the resolution of this matter and as a further incentive for you to participate in such mediation. We have given you the opportunity and many professional courtesies to solve this problem in a very simple and direct manner. For whatever reason, either you or Dr. Farrell do not believe the conviction of our position. In any event, Dr. Farrell would be extremely wise to protect his interests to effectuate a rapid destruction of Dr. Sakol's ePHI. Please be guided accordingly. Sincerely, CIA/kr cc: Peter akol, M.D. Bruce Warshawsky, Esq. VERIFICATION I, Peter J. Sakol, on behalf of Peter J. Sakol, M.D., LLC, verify that the statements made in the foregoing COMPLAINT are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C.S. §4904, relating to unsworn falsification to authorities. By. P er J. Sakol Its: Member Date: O~'O~ , 2010 CERTIFICATE OF SERVICE I, Julieanne Ametrano, Legal Secretary for the law office of Cunningham & Chernicoff, P.C., do hereby certify that a true and correct copy of the Complaint in the above-captioned matter was sent first class U.S. Mail, First Class Mail, postage prepaid on this date, to the following: Peter M. Good, Esquire Heather D. Royer, Esquire Smigel, Anderson & Sacks LLP 4431 North Front Street Harrisburg, PA 17110 COFF, P.C. Date: February 3, 2010 Julieanne Ametrano 2320 North Second Street P.O. Box 60457 Harrisburg, PA 17110 Telephone: (717)238-6570 F:\home\BJW\DOCS\SAKOL.PETER\General Business\Complaint.wpd -39- VERIFICATION I, Peter J. Sakol, on behalf of Peter J. Sakol, M.D., LLC, verify that the statements made in the foregoing MOTION FOR COORDINATION OF ACTIONS IN DIFFERENT COUNTIES PURSUANT TO Pa. R. Civ. P. §213.1 are true and correct. I understand that false statements herein are made subject to the penalties of 18 Pa. C.S. §4904, relating to unsworn falsification to authorities. --- By. P r J. Sakol Its: Member Date: `~ _ ~ , 2010 CERTIFICATE OF SERVICE I, Julieanne Ametrano, Legal Assistant with the law firm of Cunningham & Chernicoff, P.C., certify that a true and correct copy of the MOTION FOR COORDINATION OF ACTIONS IN DIFFERENT COUNTIES PURSUANT TO Pa. R. Civ. P. §213.1 will be served by electronic means and/or by first class United States Mail on the following parties indicated: Peter M. Good, Esquire Darryl J. Liguori, Esquire Smigel, Anderson & Sacks, LLP River Chase Office Center 4431 North Front Street Third Floor Harrisburg, PA 17110 Charles Artz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 ~~~~i By: __ Julieanne Ametrano 2320 North Second Street Harrisburg, PA 17110 Date: February 5, 2010 F:\Home\BJW\DOCS\SAKOL.PETER\Farrell v. Sakol\Coordination Motion.020510\Coordination Motionv2.wpd -IZ- -n ~W c_~ 9r. ~/ P ss~~ V~ ~' r SNx[GEL, ANDERSON & SACKS, LLP Peter M. Good, Esquire Raver Chase Office Center pgood@sasllp.com X431 North Front Street, 3rd Floor Darryl J. Liguori, Esquire Harrisburg, PA 17110-1778 dliguori@sasllp.com (717) 234-2401 Attorneys for Plaintiff FARRELL PLASTIC SURGERY AND IN THE COURT OF COMMON PLEAS LASER CENTER, P.C., DAUPHIN COUNTY, PENNSYLVANIA Plaintiff, ~~-_ No.2009-CV-15556-CV ~ a~. v. CIVIL ACTION -LAW ~_ PETER J. SAKOL, M.D., LLC, _- T.. Defendant. JURY TRIAL DEMANDED ~ - ~_ :T ~ PLAINTIFF'S ANSWER TO DEFENDANT'S MOTION rv FOR COORDINATION OF ACTIONS IN DIFFERENT COUNTIES `~ AND NOW COMES, Plaintiff Farrell Plastic Surgery and Laser Center, P.C. (hereinafter "Plaintiff' or "Farrell"), by and through its attorneys, Smigel, Anderson & Sacks, LLP, to file the following Plaintiffs Answer to Defendant's Motion for Coordination of Actions in Different Counties (hereinafter "Coordination Motion") and avers in support as follows: 1. Admitted as stated. 2. Denied. Plaintiff does not believe a hearing is necessary to resolve the Coordination Motion. 3. Plaintiff has no objection to oral argument if the Court deems it would be helpful to the resolution of the Coordination Motion. 4. Admitted as stated. 5. Admitted with clarification. It is admitted that Plaintiffs counsel does not concur in the Coordination Motion and that Plaintiff believes that coordination is not necessary. Plaintiffs position is that if the Court deems that coordination is necessary, then coordination should be in Dauphin County not Cumberland County. 6. Admitted as stated. f ~ 7. Admitted as stated. 8. Admitted as stated. 9. Denied. The Dauphin County Lawsuit is a breach of contract lawsuit, with related counts in equity, by Farrell against Defendant Peter J. Sakol, M.D., LLC (hereinafter "Sakol"). Farrell is seeking fifty percent (50%) of Sakol's collections for any work Sakol performed while still associated with Farrell for the time period of January 2009 pursuant to a contract entered into by the parties in approximately September 2001. See Farrell's Nov. 18, 2009 Complaint at ¶¶ 8, 18, 22, 26 and 29. On the contrary, the Cumberland County Lawsuit, filed by Sakol against Farrell, is a lawsuit based on fraud (Count I); negligent supervision of a former employee (Count II); Respondeat Superior (Count III); breach of HIPAA violations (Count IV); Commercial Disparagement (Count V); trade secret violations (Counts VI-VIII); and tortuous interference (Counts IX-X). The Cumberland County Lawsuit focuses on fraudulent acts committed by Gail Erdman, a former employee of Farrell who converted funds from Farrell. The Cumberland County Lawsuit also focuses on HIPAA violations and mailings sent out by Farrell to certain patients well after Sakol left the practice. The Cumberland County Lawsuit seeks injunctive relief and common law and equitable relief and is not focused on the contract that the parties entered into beyond referencing it to provide background information. Because the two lawsuits rely on different questions of law and fact, Farrell does not believe coordination is appropriate. 10. Admitted as stated. 11. Admitted as stated. 2 12. Denied. While both lawsuits reference the business relationship between the parties, the Dauphin County Lawsuit filed by Farrell focuses on Sakol's leaving his associated practice with Farrell and the time period of January 2009 and what collections are owed Farrell under the terms of the parties' contract. In contrast, the Cumberland County Lawsuit filed by Sakol focuses on the Farrell's actions well after Sakol left their associated practice, fraud committed by a third party, and alleged HIPAA violations. The lawsuits may have the same parties but the questions of law and fact are not similar between the two lawsuits. 13. Denied. Because the two lawsuits rely on different questions of law and fact, Farrell does not believe coordination is appropriate. a. Dauphin County is equally convenient to the parties, counsel, and potential witnesses as Cumberland County. Farrell initiated this litigation and should have the benefit of the forum he chose. Furthermore, Sakol and potential witnesses are located in, reside in, or work in Dauphin County making it more convenient that the lawsuit remain in Dauphin County. In the alternative, if the Court deems coordination is appropriate, the actions should be coordinated in Dauphin not Cumberland County. b. The fact Sakol has requested injunctive relieve in the Cumberland County Lawsuit but not in the Dauphin County Lawsuit supports Farrell's position that the two lawsuits have different questions of law and fact. c. The two lawsuits rely on different questions of law and fact with the Dauphin County Lawsuit focusing on the parties' contract and the time period of January 2009. The Cumberland County Lawsuit focuses on equitable claims, alleged HIPAA and privacy violations, and the time period of late 2009. 3 r f d. Both Farrell's counsel and Sakol's counsel have Harrisburg offices and it is more convenient for this case to be litigated in the Dauphin County Court of Common Pleas located in Harrisburg and not in Cumberland County. e. Despite having a Cumberland County address, Farrell has chosen to initiate this litigation in Dauphin County, which is the location of Sakol. Farrell also believes that many of the witnesses would find it equally convenient to litigate in Dauphin County as opposed to Cumberland County. In addition, Farrell believes that because the lawsuits rely on different questions of law and fact, it is premature to assume that the lawsuits will rely on the same witnesses. f. If the Coordination Motion is denied, both lawsuits may move along in a timely manner. It is no more likely that a combined lawsuit will result in less delay as the matter would become more complicated with additional causes of actions seeking conflicting remedies. g. As the Dauphin County Lawsuit and the Cumberland County Lawsuit involve different questions of law and fact, there would not be any duplicative or inconsistent rulings, orders, or judgments if the two lawsuits remain separate. h. As the Dauphin County Lawsuit and the Cumberland County Lawsuit involve different questions of law and fact, it is equally efficient not to coordinate the two lawsuits. i. As the Dauphin County Lawsuit and the Cumberland County Lawsuit involve different questions of law and fact, the chances of settlement remain the same whether or not they are coordinated. 4 j. The Cumberland County District Attorney's Office would not be involved in either the Dauphin County Lawsuit or the Cumberland County Lawsuit and thus the question of their participation is irrelevant. k. The fact that Farrell is involved in a conversion lawsuit against Erdman is not a common question of law or fact as to whether Sakol breached his contract with Farrell which is the crux of the Dauphin County Lawsuit. 1. Plaintiff has no objection to a stay while the Coordination Motion is pending. 14. Plaintiff has no objection to Defendant paying the costs of coordination if the Coordination Motion is granted. WHEREFORE, Plaintiff Farrell Plastic Surgery and Laser Center, P.C. respectfully requests that this Honorable Court deny Defendant's Motion for Coordination of Actions in Different Counties. In the alternative, if the Motion is to be granted, Plaintiff respectfully requests that the lawsuits be coordinated in Dauphin County as (1) it is equally convenient to the parties, the witnesses, and counsel; and (2) Plaintiff was the first party to file a complaint in Dauphin County and should not be denied it's choice of a forum to resolve this litigation. Respectfully submitted, SMIGEL, ANDERSON & SACKS, LLP Date: March 1, 2010 B ~ ~ ~~ Y Peter M. Good, Esquire - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff 5 FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Plaintiff, IN THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA No.2009-CV-15556-CV v. : CIVIL ACTION -LAW PETER J. SAKOL, M.D., LLC, Defendant. JURY TRIAL DEMANDED CERTIFICATE OF SERVICE I, Darryl J. Liguori, Esquire, attorney for the Plaintiff in the above-captioned matter, certify that I this day served a copy of the foregoing Plaintiffs Answer to Defendant's Motion for Coordination of Actions in Different Counties upon the person(s) indicated below by depositing a copy of the same in the United States Mail, first class, postage prepaid, at Harrisburg, Pennsylvania, and addressed as follows: Bruce J. Warshawsky, Esquire Cunningham & Chernicoff, P.C. 2320 North 2nd Street Harrisburg, PA 17110 Attorney for Defendant Date: March 1, 2010 Charles Artz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 Attorney for Defendant SMIGEL, ANDERSON & SACKS, LLP B ~ '~ Y• Peter M. Good, Esquire - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff DAUPHIN COUNTY CERTIFICATE OF READINESS OURT OF COMIMONIPLEAS Effective: Rev. (H), March 2009 INSTRUCTIONS: This form shall be used for the assignment ofPretrial Motions (Preliminary Objections, Motions for Judgment on the Pleadings, Motions for Summary Judgment, Divorce Special Relief and Contested Civil Motions) and the listing of a case foArbitratiort Non jury Trial or Jury Trial. File the original and one copy of this form with the Prothonotary's Office. This Certificate of Readiness must bpersonally signedby the filing counsel of record or the filing pro se party. (Use reverse side if necessaryc DO NOT ABBREVIATE PARTIES.) n PLAINTIFF(S): Farrell Plastic Surgery and Laser Center, P.C. DEFENDANT(S): Peter J. Sakol, M.D., LLC N ca ADDITIONAL DEFENDANT(S): ~ a. DOCKET NUMBER: 2009-CV-15556-CV ~ : E A. PRETRIAL MOT/ONS(Complete Sections A and G of the Certificate of Readiness) ~~~ _ - „~ ^ Preliminary Objections ^ Judgment on the Pleadings ^ Summary Judgment ^ Divorce Special Relief ^ Contested Civil M1~ions - Is oral argument requested? ^ YES ^ NO (See Dauphin County Local Rule 211) -.. ~ ~/ hereby certify that the matter is ready for disposition in accordance with the Pennsylvania Rules of Civil Procedurc+,and tlfg'Dauphin County Local Rules. -' 8. ARBITRATION(Complete Sections B, E, F and G of the Certificate of Readiness) ^ I hereby certify that the amount in controversy is $50,000 or less, and that this case is ready in all respects for disposition by a Board of Arbitration. This matter will be heard by a Board of Arbitration at the time, date, and place specified by the Chair of the panel, but, if one or more of the parties is not present at the hearing, the matter may be heard at the same time and date before a Judge of the Court without the absent party or parties being present. I also realize that there is no right to a triage novo on appeal from a decision entered by a Judge. C. NON-JURY CIVIL TR/AL(Complete Sections C, E, F and G of the Certificate of Readiness) ^ I hereby certify that all discovery in the case has been completed and that the case is ready in all respects to be assigned to a judge for a non jury civil trial in accordance with the Pennsylvania Rules of Civil Procedure and the Dauphin County Local Rules. D. CIVIL JURY TRIAL (Complete Sections D, E, F and G of the Certificate of Readiness) ^ 1 hereby certify that all discovery in the case has been completed; that I have made reasonable inquiry of all counsel andlor pro se parties to ensure that all necessary parties, attorneys, and witnesses will be available and that they are available; that serious settlement negotiations have been conducted; and that the case is ready in all respects for trial, all in accordance with the Pennsylvania Rules of Civil Procedure and the Dauphin County Local Rules. I understand that this case will be listed for a jury trial for the next trial term in accordance with the timelines found in the annual court calendar. I further understand that sanctions may be imposed upon me by the Court for the filing of an improper Certificate of Readiness listing a case for jury trial. Has this case previously been certified for trial? ^ Yes, date previously certified: ^ No, never previously certified E. TYPE OF CASE AND ESTIMATED TRIAL LENGTH ^ Contract ^ Medical Malpractice ^ Motor Vehicle Accident ^ Products Liability ^ Premises Liability ^ Other Malpractice ^ Other Type of Case: Estimated Trial Time: days F. MEDIATION ^ Pursuant to Dauphin County Local Rule 1001, I hereby certify that mediation has been previously pursued that the topic of mediation was discussed by not only counsel with their clients but also by all counsel and/or pro se parties and rejected only after good faith consideration. G. COUNSEL (List names, addresses and telephone numbers of all counsel and check appropriate box to designate listing counsel) Plaintiff(s): Peter M. Good, Esquire Telephone Number: 717-234-2401 Smigel ,Anderson & Sacks, LLP - 4431 North Front Street, Third Floor, Harrisburg, PA 17110 Email Address: pgood@sasllp.com ^ Listin Counsel Defendant(s): Bruce J. Warshawsky, Esquire Telephone Number: 717-238-6570 Cunningham & Chernicoff, P.C. - 2320 North Second Street, Harrisburg, PA 17110 Email Address: bjw@cclawpc.com ^ Listin Counsel Additional Defendant(s): Telephone Number: Email Address: ^ Listin Counsel VERIFICATION: I, the undersigned listing counsel or pro se party, hereby acknowledge that sanctions may be imposed upon me for the improper filing of this Certificate of Readiness and that false statements herein are made subject penalties of 18 Pa.C.S. Section 4904, relating to unsworn falsification to auth ities. I further certify that I will immediately serve all counsel r arties ith opy o is ificate Bess. Date Signature of g unsel or ro Se Party ead Verification First) :.._r :.a -~ t~ ~. ~ S~ , r~,F ~ a ~ ~~ ti ..,a r~ .wa ~ },,1 :.:.ac t,'~, ~., ._. _ .. , ~~9 4 ~ ~ j S ~~,~ J ~ ~C? CERTIFICATE OF READINESS DAUPHIN COUNTY `` TWELFTH JUDICIAL DISTRIC COURT OF COMMON PLEAS Effective: Rev. (H), March 2009 INSTRUCTIONS: This form shall be used for the assignment ofPretrlal Motions (Preliminary Objections, Motions for Judgment on the Pleadings, Motions for Summary Judgment, Divorce Special Relief and Contested Civil Motions) and the listing of a case foArbitrationt Non jury Trialor Jury Trial. File the original and one copy of this form with the Prothonotary's Office. This Certificate of Readiness must bpersonally signed by the filing counsel of record or the filin ro se art . Use reverse side if necessa DO NOT ABBREVIATE PARTIES. PLAINTIFF(S): Farrell Plastic Surgery and Laser Center, P.C. DEFENDANT(S): Peter J. Sakol, M.D., LLC ~, - -- ADDITIONAL DEFENDANT(S): DOCKET NUMBER: 2009-CV-15556-CV ~ ~ : == ~ ' A. PRETRIAL MOTIONS(Complete Sections A and G of the Certificate of Readiness) ~ ^ Preliminary Objections ^ Judgment on the Pleadings ^ Summary Judgment ^ Divorce Special Relief ^ Contested Civilce0otions Is oral argument requested?^ YES ^ NO (See Dauphin County local Rule 211) :.--~ ~, MI hereby certify that the matter Is ready for disposition /n accordance with the Pennsylvania Rules of Civil Procedure and Dauphin County Local Rules. 8. ARBITRATION(Complete Sections B, E, F and G of the Certificate of Readiness) ^ I hereby certify that the amount in controversy is 550,000 or less, and that this case Is ready in all respects for disposition by a Board of Arbitration. This matter will be heard by a Board of Arbitration at the time, date, and place specified by the Chair of the panel, but, if one or more of the parties Is not present at the hearing, the matter may be heard at the same time and date before a Judge of the Court without the absent party or parties being present. I also realize that there Is no right to a triaile novo on appeal from a decision entered by a Judge. C. NON-JURY CIVIL TR/AL(Complete Sections C, E, F and G of the Certificate of Readiness) ^ I hereby certify that all discovery in the case has been completed and that the case is ready in all respects to be assigned to a judge for a non jury civil trial in accordance with the Pennsylvania Rules of Civil Procedure and the Dauphin County Local Rules. D. CIVIL JURY TRIAL (Complete Sections D, E, F and G of the Certificate of Readiness) ^ I hereby certify that all discovery in the case has been completed; that 1 have made reasonable inquiry of all counsel andlor pro se parties to ensure that all necessary parties, attorneys, and witnesses will be available and that they are available; that serious settlement negotiations have been conducted; and that the case is ready In all respects for trial, all In accordance with the Pennsylvania Rules of Civil Procedure and the Dauphin County Local Rules. I understand that this case will be listed fora )ury trial for the next trial term in accordance with the timelines found in the annual court calendar. 1 further understand that sanctions may be imposed upon me by the Court for the filing of an improper Certificate of Readiness listing a case for jury trial. Has this case previously been certified for trial? ^ Yes, date previously certified: ^ No, never previously certified E. TYPE OF CASE AND ESTIMATED TRIAL LENGTH ^ Contract ^ Medical Malpractice ^ Motor Vehicle Accident ^ Products Liability ^ Premises Liability ^ Other Malpractice ^ Other Type of Case: Estimated Trial Time: days F. MEDIATION ^ Pursuant to Dauphin County Local Rule 1001, I hereby certify that mediation has been previously pursueaF that the topic of mediation was discussed by not only counsel with their clients but also by all counsel andlor pro se parties and rejected only after good faith consideration. G. COUNSEL (List names, addresses and telephone numbers of all counsel and check appropriate box to designate listing counsel) Plaintiff(s): Peter M. Good, Esquire Telephone Number: 717-234-2401 Smigel ,Anderson 8 Sacks, LLP -4431 North Front Street, Third Floor, Harrisburg, PA 17110 Email Address: pgood~sasllp.com ^ Listin Counsel Defendant(s): Bruce J. Warshawsky, Esquire Telephone Number: 717-238-6570 Cunningham 8 Chernicoff, P.C. - 2320 North Second Street, Harrisburg, PA 17110 Email Address: bjw~cclawpc.com ^ Listin Counsel Additional Defendant(s): Telephone Number: Email Address: ^ Listin Counsel VERIFICATION: I, the undersigned listing counsel or pro se party, hereby acknowledge that sanctions may be imposed upon me for the improper filing of this Certificate of Readiness and that false statements herein are made subject penalties of 18 Pa.C.S. Section 4904, relating to unsworn falsification to auth riti'els. I further certify that 1 will immediately serve all counse r arties ith opy o is ificate a iness. V Date Signature of g unsel or ro Se Party ead Verification First) . ., .. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Respondent/Plaintiff IN THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA N0:2009-CV-15556-CV v. CIVIL ACTION -LAW PETER J. SAKOL, M.D., LLC, JURY TRIAL DEMANDED Movant/Defendant ~. ~o :: ti CERTIFICATE OF SERVICE _;. -~ is I, Julieanne Ametrano, Legal Assistant with the law firm of Cunningham & Cher r off, P.C., certify that a true and correct copy of the CERTIFICATE OF READINESS, attached hereto as Exhibit "A" and which was filed with the Dauphin County Prothonotary on March 1, 2010 will be served by first class United States Mail on the following parties indicated: Peter M. Good, Esquire Darryl J. Liguori, Esquire Smigel, Anderson & Sacks, LLP River Chase Office Center 4431 North Front Street Third Floor Harrisburg, PA 17110 By Charles Artz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 ,,<,~,~aG,~a~a Julieanne Ametrano 2320 North Second Street Harrisburg, PA 17110 Date: March 2, 2010 F:\Home\BJW\DOCS\SAKOL.PETER\Fartell v. Sakol\COS.Certificate of Readiness.wpd EXHIBIT `A' ' DAUPHIN COUNTY CERTIFICATE OF READINESS OURT OF COMMONIPLEAS Effective: Rev. (H), March 2009 INSTRUCTIONS: This form shall be used for the assignment ofPretrial Motions (Preliminary Objections, Motions for Judgment on the Pleadings, Motions for Summary Judgment, Divorce Special Relief and Contested Civil Motions) and the listing of a case foArbitration, Non jury Trialor Jury Trial. File the original and one copy of this form with the Prothonotary's Office. This Certificate of Readiness must b~ersonally signed by the filing counsel of record or the filing pro se party. (Use reverse side if necessar~c DO NOT ABBREVIATE PARTIES.1 ... a ,.,_ _ . DOCKET NUMBER: 2009-CV-15556-CV ,,, --~- _ _ A. PRETRIAL MOT/0NS(Complete Sections A and G of the Certificate of Readiness) ~ ^ Preliminary Objections ^ Judgment on the Pleadings ^ Summary Judgment ^ Divorce Special Relief ^ Contested Civil ~1 tions I l s ora argument requested? ^ YES ^ NO (See Dauphin County Locai Rule 211) III hereby certify that the matter !s ready for disposition /n accordance with the Pennsylvania Rules of Clvll Procedure and the Dauphin County Local Rules. B. ARB/TRATION(Compiete Sections B, E, F and G of the Certificate of Readiness) ^ 1 hereby certify that the amount in controversy is E50,000 or less, and that this case is ready in all respects for disposition by a Board of Arbitration. This matter will be heard by a Board of Arbitration at the time, date, and place specified by the Chair of the panel, but if one or , more of the parties is not present at the hearing, the matter may be heard at the same time and date before a Judge of the Court without the absent party or parties being present. 1 also realize that there is no right to a triaYe novo on appeal from a decision entered by a Judge. C. NON-JURY CIVIL TR/AL(Complete Sections C, E, F and G of the Certificate of Readiness) ^ I hereby certify that all discovery in the case has been completed and that the case is ready in all respects to be assigned to a judge for a non jury civil trial in accordance with the Pennsylvania Rules of Civil Procedure and the Dauphin County Local Rules. D. CIVIL JURY TRIAL (Complete Sections D, E, F and G of the Certificate of Readiness) ^ I hereby certify that all discovery in the case has been completed; that I have made reasonable inquiry of all counsel andlor pro se parties to ensure that all necessary parties, attorneys, and witnesses will be available and that they are available; that serious settlement negotiations have been conducted; and that the case is ready in all respects for trial, all in accordance with the Pennsylvania Rules of Civil Procedure and the Dauphin County Local Rules. I understand that this case w111 be listed for a Jury trial for the next trial term in accordance with the timelines found in the annual court calendar. I further understand that sanctions may be imposed upon me by the Court for the filing of an improper Certificate of Readiness listing a case for Jury trial. Has this case previously been certified for trial? ^ Yes, date previously certified: ^ No, never previously certified E. TYPE OF CASE AND ESTIMATED TRIAL LENGTH ^ Contract ^ Medical Malpractice ^ Motor Vehicle Accident ^ Products Liability ^ Premises Liability ^ Other Malpractice ^ Other Type of Case: Estimated Trial Time: days F. MEDIATION ^ Pursuant to Dauphin County Local Rule 1001, 1 hereby certify that mediation has been previously pursumt~ that the topic of mediation was discussed by not only counsel with their clients but also by all counsel andlor pro se parties and rejected only after good faith consideration. G. COUNSEL (List names, addresses and telephone numbers of ali counsel and check appropriate box to designate listing counsel) Plaintiff(s): Peter M. Good, Esquire Telephone Number: 717-234-2401 Smigel ,Anderson 8 Sacks, LLP -4431 North Front Street, Third Floor, Harrisburg, PA 17110 Email Address: pgood~sasllp.com ^ Listin Counsel Defendant(s): Bruce J. Warshawsky, Esquire Telephone Number: 717-238-6570 Cunningham 8 Chernicoff, P.C. - 2320 North Second Street, Harrisburg, PA 17110 Email Address: bjw~cclawpc.com ^ Listin Counsel Additional Defendant(s): Telephone Number: Email Address: ^ Listin Counsel VERIFICATION: I, the undersigned fisting counsel or pro se party, hereby acknowledge that sanctions may be imposed upon me for the improper filing of this Certificate of Readiness and that false statements herein are made subject penalties of 18 Pa.C.S. Section 4904, relating to unsworn falsification to auth ities. I further certify that I will immediately serve all counse r arties ith opy o is ificate t'~ess. ~ l~~ ~~ v /~~` Date Signature of g unsel or ro Se Party ead Verification First) _. . '" ' .v ~~~ted FARRELL PLASTIC SURGERY AND : IN THE COURT OF COMMON PLEAS, LASER CENTER, P.C., :DAUPHIN COUNTY, PENNSYLVANIA Plaintiff, v : N0.2009-CV-15556-CV N CIVIL ACTION -LAW ~ ~- !~ PETER J. SAKOL, M.D., LLC, c.: ~ o o'~J Defendant, :CIVIL ACTION -LAW -o~ ~O ~~*"+n JURY TRIAL DEMANDE~= ^~ z ~ ~ ~ Z~ r, oo rn ORDER z t ~ AND NOW, this 11 day of March, 2010, it is hereby ordered that Oral Arguments on the Motion for Coordination of Actions be scheduled for the ~9~`' day of (I , 2010 at _1 o'clock ~.m. in COG~rDDr~i 3 on the 3rd Floor of the Dauphin County Courthouse. IT IS further ordered that briefs on the Motion for Coordination of Action shall be due one week after oral arguments are held. BY THE COURT: 6J+ w /G /<- [.. De rah ssis urcillo, J. Distribution: The Hon. Deborah Essis Curcillo Bruce J. Warshawsky, Esq., Cunningham & Chernicoff, P.C., 2320 North Second St. Harrisburg, PA 17110 Peter M. Good, Esq., Darryl J. Liguori, Esq., Smigel, Anderson & Sacks, LLP, River Chase Office Center, 4431 North Front St., Third Floor, Harrisburg, PA 17110 Charles Artz, Esq., 200 North Third St., Ste 12B, Harrisburg, PA 17101 r' FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Plaintiff, Copies Distributed Date 3~--`~-,'-=- ~.n~t~ IN THE COURT OF COMMON PLEAS, DAUPHIN COUNTY, PENNSYLVANIA v. : NO.2009-CV-15556-CV ~~J~ CIVIL ACTION -LAW PETER J. SAKOL, M.D., LLC, ~ CIVIL ACTION -LAW ~ ..R Defendant, _ :JURY TRIAL DEMANDED .Go ~ Q ~"y.r ZZ ..o ~,'~...~ ORDER ~ p 7G ,~ AND NOW, this 9 day of March, 2010, upon consideration of the Motio~or Coordination of Actions in Different Counties pursuant to Pa. R. Civ. P. § 213.1 and the Answer thereto, it is hereby ORDERED that this matter shall be stayed. It is FURTHER ORDERED that the matter docketed to 09-6023 in Cumberland County shall be stayed pending a resolution of this Coordination Motion by this Court and pending a further Order of this Court regarding Briefs, a Hearing Date and/or Oral Argument. This Order shall be certified and delivered to the Cumberland County Court of Common Pleas. BY THE COURT: ~~~ ~~~~~ Deborah Essis Curcillo, J. s ~ Distribution: The Hon. Deborah Essis Curcillo Bruce J. Warshawsky, Esq., Cunningham & Chernicoff, P.C., 2320 North Second St. Harrisburg, PA 17110 Peter M. Good, Esq., Darryl J. Liguori, Esq., Smigel, Anderson & Sacks, LLP, River Chase Office Center, 4431 North Front St., Third Floor, Harrisburg, PA 17110 Charles Artz, Esq., 200 North Third St., Ste 12B, Harrisburg, PA 17101 Cumberland County Court of Common Pleas IMAGED FARRELL PLASTIC SURGERY & LASER CENTER, P. C., Plaintiff Copies Distrib»ted Date .~ l/ (t~ In~t~als 1N THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA vs. NO. 2009 CV 15556 CV = ~_ Q ~_ ~ --A, , ~.~,;, PETER SAKOL, M. D., LLC, : _ ~ ~=' ~~ ~~ ~ ~,~ Defendant :CIVIL ACTION -LAW ~. ~ ~ ~- _. • -; w .., •. ORDER ~ w AND NOW, this 1st day of April, 2010, it is hereby ordered that Oral Arguments originally scheduled for April 19, 2010 at 8:30 a. m. have now been continued until Monday, Apri126, 2010 at 1:30 p. m., in Courtroom #3, THIRD FLOOR of the DAUPHIN COUNTY COURTHOUSE. BY THE COURT: • ~/}t6O ~ JUDGE The Honorable Judge Deborah Essis Curcillo DISTRIBUTION: Bruce J. Warshawsky, Esq., Cunningham & Chernicoff, P.C., 2320 North 2°d Street, Harrisburg, PA 17110 Peter M. Good, Esq., Darryl J. Liguori, Esquire, Smigel, Anderson & Sacks, LLP, River Chase Office Center, 4431 North Front Street, Third Floor, Harrisburg, PA 17110 Charles Artz, Esq., 20 North Third Street, Suite 12B, Harrisburg, PA 17101 Chambers of the Honorable Judge Deborah Essis Curcillo ~~ !iVIAGED 2DtQ APR ~2 r ~~~ 3~ 17 F : f ,,t, ~ ~.~ ~°, Bruce J. Warshawsky, Esquire PA Supreme Court ID #58799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second Street Harrisburg, PA 17110 Telephone: (717) 238-6570 Attorney for Defendant, Peter J. Sakol, M.D., LLC FARRELL PLASTIC SURGERY AND LASER CENTER, P.C. ; Plaintiff, vs. PETER J. SAKOL, M.D., LLC, : Defendant. IN THE COURT OF COMMON PLEAS OF DAUPHIN COUNTY, PENNSYLVANIA \`~55 L2 CASE NO: 2009-CV-1.5~5~3'frCV CIVIL ACTION - AT LAW DEFENDANT'S BRIEF IN SUPPORT OF DEFENDANT'S MOTION FOR COORDINATION OF ACTIONS IN DIFFERENT COUNTIES PURSUANT TO PA. R.C.P. 213.1 I. PROCEDURAL HISTORY On September 3, 2009 Peter J. Sakol, M.D., LLC ("Sakol") initiated an action by the filing of a praecipe for writ of summons with the prothonotary of Cumberland County, Pennsylvania docketed at no. 09-6023 (the "Sakol Action") against Farrell Plastic Surgery and Laser Center, P.C. ("Farrell"). Thereafter, on November 18, 2009, Farrell filed a complaint in the Court of Common Pleas of Dauphin County, Pennsylvania (the "Farrell Action") alleging, 4 h inter alia, that Sakol breached an Oral Contract (herein defined) with Farrell, seeking damages. On February 3, 2010 Sakol filed a timely Answer with New Matter in the Farrell Action and, on the same day, filed a complaint in the Sakol Action. On February 5, 2010, Sakol filed with this court a Motion for Coordination of Actions in Different Counties pursuant to Pa. R. Civ. P. 213.1 (the "Motion"). Farrell's counsel did not concur in the Motion and filed an answer to the Motion on March 1, 2010. On March 9, 2010, in response to the Motion and Farrell's Answer to the Motion, this Court stayed both the Sakol Action and the Farrell Action, and scheduled oral arguments and requested briefs on the Motion for April 26, 2010. This brief is submitted by Sakol in support of the Motion. II. STATEMENT OF THE FACTS Peter J. Sakol, M.D. ("Dr. Sakol"), the sole member of Sakol and a physician licensed to practice medicine in the Commonwealth, entered into a terminable, at-will oral contract (the "Oral Contract") with Farrell in March, 2001. The Oral Contract required Farrell to provide to Sakol office space and administrative services in exchange for 50% of each prior month's collections received by Sakol. Sakol and Farrell also shared a computerized billing system under the Oral Contract. Each physicianlpractice had access to a common database (the "Common Database") containing the basic demographic information about both practices' patients in order to facilitate the administration of each practice, which was limited to names, addresses, dates of birth, social security numbers, identification of primary insurance carriers, and insurance company account numbers (the "Common Database"). However, each practice-Sakol and Farrell respectively- maintained their own paper file and computerized medical and patient rl records and computerized billing system separate and distinct from the other doctor's patient records. Sakol only accessed the Common Database in addition to the database of his billing and patient records, while Farrell, through its employees, had access not only to its' own billing and patient information and the Common Database, but also the Sakol billing and patient information in order to administer both practices. On or about April 10, 2003 the parties supplemented the Oral Contract by entering into a Business Associate Agreement (the "BAA"), the terms of which, among other things, governed Farrell's use of Sakol's patient and billing information. In late 2008, Farrell sought to alter the payment terms of the Oral Contract, advising Sakol that the existing payment structure was insufficient to cover Sakol's share of the cost of the administrative services being provided by Farrell. The parties' negotiations broke down in early 2009 when Farrell demanded that Sakol pay the flat fee of $30,000.00 per month, which Sakol refused. In the meantime, and during the course of these negotiations, Farrell provided to Sakol a report of Farrell's outstanding accounts receivable as of the end of 2008 in an attempt to show Farrell's need for additional remuneration. After Sakol reviewed this report, he believed that Farrell had been committing billing fraud. Sakol then terminated the Oral Contract and BAA on January 23, 2009. After the termination of their business relationship, Sakol and Farrell sought to reach a settlement agreement and the parties negotiated for over a month before Farrell, through counsel, finally informed Sakol that he would not sign the settlement agreement and, on March 10, 2009, for the first time ever, demanded that Sakol pay a percentage of the Sakol cash collections which post-date the termination of the Oral Contract (essentially the basis of the Farrell action). !~ From and after the date that the Oral Contract and the BAA were terminated, Farrell willfully engaged in a course of conduct which was injurious to Sakol. These actions included (1) diverting Sakol patients to Dr. Deborah Farrell; (2) making patently false statements defaming Dr. Sakol by communicating misinformation about the termination of the Sakol-Farrell business relationship; and (3) intentionally and repeatedly utilizing the Sakol billing and confidential patient information to its benefit and to Sakol's detriment in violation of the BAA and the Health Insurance Portability and Accountability Act ("HIPAA"). In the Farrell Action, Farrell alleges that Sakol has breached the Oral Contract by failing to pay 50% of his collections for the period from January 1, 2009 to 3anuary 31, 2009, in addition to one half of the collections through the present time. The Sakol Action also alleges Farrell's breaches of the Oral Contract by reason of Farrell's commission of fraud, negligent supervision and respondeat superior. Additionally, the Sakol Action alleges defamation, commercial disparagement, trade secret violations, tortious interference with doctor-patient relations, tortious interference with prospective contractual relations and violations of HIPAA, all of which deals with the post-termination conduct of Farrell but which is necessarily intertwined with the Oral Contract and BAA, the common denominators in the Sakol Action and the Farrell Action. III. QUESTION PRESENTED A. SHOULD THE COURT ORDER COORDINATION OF THE SAKOL ACTION AND THE FARRELL ACTION IN CUMBERLAND COUNTY WHERE THE CONTRACT UNDER WHICH THE PRESENT DISPUTE HAS ARISEN WAS CONTEMPLATED, EXECUTED, PERFORMED AND BREACHED BY FARRELL IN CUMBERLAND COUNTY. (Suggested Answer: YES) IV. DISCUSSION The Pennsylvania Rules of Civil Procedure provide that a party, upon proper notice to all other parties, may seek to have actions pending in different counties that involve a common question of law or fact or that arise from the same transaction or occurrence coordinated upon a proper motion to the court in which a complaint was first filed. See Pa.R.Civ.P. 213.1(a). The basis for the rule is the avoidance of multiple trials and proceedings in such actions and the resulting economy to both the litigants and the judicial system." See Pa. R.Civ.P. 213.1, Explanatory Comment, 1990. In determining whether to order coordination and which location is appropriate for the coordinated proceedings, the court shall consider six factors enumerated by the rules. See Pa.R.Civ.P. 213.1(c). "In deciding whether and where to coordinate actions, the court must consider the totality of the circumstances and examine in particular the factors enumerated in section (c) [of Pa.R.Civ.P. 213.1]...." See Wohlsen/Crow v. Pettinato, 446 Pa. Super. 215, 666 A.2d 701 (1995). 1. Both the Farrell Action and the Sakol Action arise out of the same transaction and are the product of the same factual circumstances, the Oral Contract. Allowing the Sakol Action and the Farrell Action to proceed separately could lead to different results in the interpretation of the parties' rights under the Oral Contract, and it would be needlessly inefficient to conduct separate trials on the issue of either party's liability under the Oral Contract. The first factor enumerated in section (c) of Pa. R. Civ. P. 213.1 is whether the common question of fact or law is predominating and significant to the litigation. "So long as there is a common question of law or a common question of fact or the cases arise out of the same transaction or occurrence, a transfer and coordination order maybe entered. See Lincoln General Ins. Co. v. Donahue, 151 Pa.Commw. 297, 616 A.2d 1076 (Pa.Commw. Ct., 1992). Here, the gravamen of both the Sakol Action and the Farrell Action is a breach of the Oral Contract. Specifically, Farrell's complaint asserts a breach of contract for Sakol's alleged failure to pay certain sums it alleges are due under the Oral Contract. Important as to the bigger picture, however, Sakol's Action sets forth factual circumstances that constitute fraud in connection with Farrell's performance under the Oral Contract, a defense to the breach of contract claim, in addition to a number of other claims which are all related to the business relationship between the parties. Where, as here, one suit alleges breach of a contract and another suit alleges, inter alia, an affirmative cause of action under the same Oral Contract which would also constitute a defense to breach of contract, the facts and circumstances giving rise to both cases are part and parcel of one another. Farrell, through counsel, argues in his answer to the Motion that the Sakol Action does not share the same predominating questions of law or fact because the Sakol Action is based on, inter alia, fraud, negligent supervision and violations of HIPAA, while the Farrell Action is based on breach of the Oral Contract and damages thereof. See Farrell Complaint ¶ 9. However, Farrell chooses not to recognize the fact that the very first count of the Sakol Action is for breach of the same Oral Contract. See Sakol Complaint ¶¶ 46-54. Certainly, the Sakol Action also focuses on Farrell's post-termination [of the Oral Contract] conduct, but these counts are in addition to and supplement Sakol's breach of contract claims and have a substantial connection thereto. In Ahnert v. Rank America, Inc., 429 Pa.Super. 505, b32 A.2d 1336 (Pa. Super. Ct., 1993), the court was faced with the determination of whether common questions of law or fact were sufficient to justify coordination. In that case, shareholders of Rank America, Inc. filed suit in Monroe County seeking to enforce a settlement agreement between the corporation and its shareholders, while the corporation sued the shareholders in Philadelphia County based on principles of fraud and misrepresentation. Id. at 1337. There, the Superior Court overturned the Monroe County court's finding of common questions of fact or law where the trial court merely found "interrelatedness" between a claim stemming from Maryland, the enforceability of a settlement agreement, and in the effect of an acquisition agreement occurring at different times. Id. The case at bar, however, is distinguishable because both the Sakol Action and the Farrell Action deal with the same Oral Contract, and the alleged breaches thereof. See also Rezk v. Dubois Medical Supply, Inc., 75 Pa. D. & C.4"' 276 (Pa. Com. Pl. 2005)(commonality of questions of fact and/or law sufficient where two actions initiated in two different counties arising out of the enforceability and breach of a covenant not to compete and the consideration ancillary to its execution). Accordingly, both the Sakol Action and the Farrell Action arise out of the same transaction, and share common and predominating questions of law and fact with regard to the agreements and contracts under which their relationship existed and terminated. 2. Coordination of these two actions in Cumberland County is appropriate because, while Dauphin and Cumberland County are both relatively convenient, the contract was formed, executed, performed and breached in Cumberland County. The Oral Contract was contemplated and executed in Cumberland County, performed for approximately eight years in Cumberland County, and breached in Cumberland County. All potential witnesses gained their knowledge through their employment in Farrell's Cumberland County practice location. Further, the principal professional offices of both parties are in Cumberland County. Indeed, the only connection Dauphin County has with the instant case is the fact that Dr. Sakol resides in Dauphin County and the registered address of Sakol (the LLC) is Dr. Sakol's Dauphin County residence. Finally, counsel for both parties have their principal offices in Harrisburg; however, the practice of law in Central Pennsylvania routinely takes counsel to neighboring counties and it would not be extraordinary to require Plaintiff's counsel to litigate the matter in Cumberland County. Farrell's Answer to the Motion argues that, because Farrell initiated this litigation, he should have the benefit of the forum he chose. This argument, however, is unpersuasive. "While a plaintiff's choice [of venue] is entitled to deference, deprivation of the chosen forum will occur whenever there is a transfer made under Rule 213.1" Lincoln at 1081. Moreover, "The choice of venue, like the decision to coordinate, is left to the sound discretion of the trial court...." Wohlsen/Crow at 704. Accordingly, the facts of this dispute strongly suggest that coordination should be ordered and that the action should be transferred to Cumberland County. 3. Coordination of the Dauphin County action and the Cumberland County action will not result in any delay or expense to any party, or prejudice any party because discovery has not yet been conducted by either parry, and a coordinated Cumberland County case can proceed immediately. The third factor enumerated by the Rule is whether coordination will result in unreasonable delay or expense to a party or otherwise prejudice a party in an action which would be subject to coordination. See Pa.R.Civ.P. 213.1(c)(3). If the coordination order is entered in Cumberland County there will be virtually no delay, much less an unreasonable delay or prejudice to Farrell. Neither party has begun, let alone completed, any pre-trial discovery, conducted depositions, etc. Both actions are still in the pleading stage. 4. Coordination of these actions in Cumberland County will effect the more efficient utilization of judicial facilities and personnel, as well as the just and efficient conduct of the actions because by trying one case in Cumberland County there can be a final resolution to all of the issues. The fourth factor to be considered is the effect an order of coordination may have on the efficient utilization of judicial facilities and personnel and the just and efficient conduct of the actions. See Pa.R.Civ.P. 213.1(c)(4). Here, coordination is an appropriate way to achieve efficient utilization of judicial facilities and time. Farrell, through counsel, argues in his Answer to the Motion, that it is no more likely that a combined lawsuit would result in less delay than trying two separate actions since a coordinated matter would become more complicated. See Plaintiff s Answer to Defendant's Motion to Coordinate ¶13(f). However, the Superior Court has rejected this assertion, saying "Rule 213.1 is designed to promote efficiency by bringing both actions into one judicial district. Obviously, this will increase the workload of the court to which the case is transferred. The efficiency gain lies in reducing the caseload of the court from which the case is transferred" Lincoln at 1081. Accordingly, by ordering coordination of this action, the Court will achieve the more efficient utilization of judicial resources. 5. Coordination of these actions in Cumberland County will eliminate all risk of duplicative and inconsistent rulings, orders or judgments because there will only be one case and only one finder of fact. The fifth factor to be considered is the disadvantages of duplicative and inconsistent rulings, orders or judgments. See Pa. R.Civ.P. 213.1(c)(5). The Explanatory Comment to Rule 213.1 states that "A problem sought to be relieved by this rule is the instance where actions proceed simultaneously in more than one county and no court will defer to another and no party is willing to litigate the claim in a county other than the one of his choosing. This situation leads to a duplication of effort by the courts and the parties and may result in inconsistent rules and orders." Explanatory Comment, 1990. Here, a single determination of the respective rights and obligations of both parties would most effectively avoid duplicative and inconsistent rulings, orders or judgments. Moreover, Farrell has sued his former office manager, Gail Erdman ("Erdman"), in Cumberland County seeking relief for certain conduct on Erdman's part, the outcome of which will directly impact three (3) of Sakol's claims against Farrell, including his control and supervision, or lack thereof, of Erdman. Additionally, Dr. Sakol seeks injunctive relief in the Sakol Action and the participation of the Cumberland County District Attorney's (which is considering the prosecution of Erdman) office will be required, which accentuates the need to coordinate the Sakol Action and the Farrell Action in Cumberland County. 6. Finally, the likelihood of settlement of the actions should coordination be denied is virtually none since Farrell has denied Sakol's initial request for mediation of the present dispute and, after more than a month of settlement negotiations preceding the filing of these actions, the parties could not resolve the dispute. The final factor enumerated by the Rules is the likelihood of settlement of the actions without further litigation should coordination be denied. See Pa.R.Civ.P. 213.1(c)(6). As an initial point, the parties have, per the Dauphin County Local Rule, considered mediation, but Farrell has rejected Sakol's request for same. Second, settlement negotiations, which lasted over a month, finally broke down due to Farrell's insistence to demand payment without regard for the claims raised in the Sakol Action. Accordingly, by ordering coordination of these two actions, the Court will actually increase the likelihood for settlement between the parties because both parties will be faced with a single consolidated trial that will determine their rights and obligations. Conversely, failure to order coordination will leave virtually zero probability of settlement since Farrell has already rejected Sakol's request to participate in mediation. V. CONCLUSION For the reasons stated above, Sakol respectfully requests that this Court enter an Order coordinating this case docketed to Cumberland County, and transferring the case to the Court of Common Pleas of Cumberland County, Pennsylvania for further adjudication. Respectfully submitted, Date: April 22, 2010 gy. Bruce J. Warshaws squire PA Supreme Court #58799 CUNNINGHAM & CHERNICOFF, P.C. 2320 North Second Street Harrisburg, PA 17110 Telephone: (717) 238-6570 Attorney for Defendant CERTIFICATE OF SERVICE I, Julieanne Ametrano, Legal Assistant with the law firm of Cunningham & Chernicoff, P.C., certify that a true and correct copy of the DEFENDANT'S BRIEF IN SUPPORT OF DEFENDANT'S MOTION FOR COORDINATION OF ACTIONS IN DIFFERENT will be served by first class United States Mail on the following parties indicated: Peter M. Good, Esquire Darryl J. Liguori, Esquire Smigel, Anderson & Sacks, LLP River Chase Office Center 4431 North Front Street Third Floor Harrisburg, PA 17110 Date: Apri122, 2010 Charles Artz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 ~~~ G!%~ ~y!.Qi1 k By: ~ ulieanne Ametrano 320 North Second Street Harrisburg, PA 17110 F:\Home\BJW\DOCS\SAKOL.PETER\Farrell v. Sakol\Brief in Support of Motion to Coordinate.doc . ~ 1- SMIGEL, ANDERSON & SACKS, LLP Peter M. Good, Esquire River Chase Office Center ~ pgood@sasllp.com 4431 North Front Street, 3rd Floor Darryl J. Liguori, Esquire Harrisburg, PA 1 71 1 0-1 778 dliguori@sasllp.com (717) 234-2401 Attorneys for Plaintiff FARRELL PLASTIC SURGERY AND IN THE COURT OF COMMON PLEAS LASER CENTER, P.C., DAUPHIN COUNTY, PENNSYLVANIA r,~. Plaintiff, No.2009-CV-15556-CV °i - ,~ .. • , CIVIL ACTION -LAW - t~ PETER J. SAKOL, M.D., LLC, Defendant. JURY TRIAL DEMANDED = - hJ PLAINTIFF'S BRIEF IN OPPOSITION TO DEFENDANT'S MOTION " FOR COORDINATION OF ACTIONS IN DIFFERENT COUNTIES I. PROCEDURAL HISTORY On September 3, 2009, Peter J. Sakol, M.D., LLC (hereinafter "Sakol") initiated an action by filing a praecipe for writ of summons in the Court of Common Pleas of Cumberland County (hereinafter "the Sakol action") against Farrell Plastic Surgery and Laser Center, P.C. (hereinafter "Farrell"). On November 18, 2009, Farrell filed a Complaint in the Court of Common Pleas of Dauphin County against Sakol (hereinafter "the Farrell Action"). The Dauphin County Lawsuit is a breach of contract lawsuit, with related counts in equity, against Sakol. Farrell is seeking fifty percent (50%) of Sakol's collections for any work Sakol performed while still associated with Farrell for the time period of January 2009 pursuant to a contract entered into by the parties in approximately September 2001. See Farrell's Nov. 18, 2009 Complaint at ¶¶ 8, 18, 22, 26 and 29. On February 3, 2010, Sakol filed an Answer with New Matter in the Farrell Action. Also on February 3, 2010, Sakol filed a Complaint in the Sakol Action. The Sakol Action is a lawsuit based on fraud (Count I); negligent supervision of a former employee (Count II); Respondeat Superior (Count III); breach of HIPAA violations (Count IV); Commercial Disparagement (Count V); trade secret violations (Counts VI-VIII); and tortuous interference (Counts IX-X). The Cumberland County Lawsuit focuses on fraudulent acts committed by Gail Erdman (hereinafter "Erdman"), a former employee of Farrell who converted funds from Farrell. The Cumberland County Lawsuit also focuses on HIPAA violations and mailings sent out by Farrell to certain patients well after Sakol left the practice. The Cumberland County Lawsuit seeks injunctive relief and common law and equitable relief and is not focused on the contract that the parties entered into beyond referencing it to provide background information. On February 5, 2010, Sakol filed a Motion for Coordination of Actions in Different Counties (hereinafter the "Coordination Motion"). Farrell filed an Answer opposing the Motion on March 1, 2010. On March 9, 2010, this Court stayed both the Sakol Action and the Farrell Action and issued an oral argument and briefing schedule. This Brief is Offered in Opposition to the Motion. II. FACTUAL HISTORY Farrell is engaged in the business of providing plastic surgery and other medical services to patients in the Central Pennsylvania area. Dr. Sakol is a licensed Pennsylvania physician who practices in the specialty of ophthalmic plastic and reconstructive surgery . In approximately September 2001, Farrell Plastic Surgery and Dr. Sakol entered into an oral agreement by which Dr. Sakol would conduct his medical practice in Farrell Plastic Surgery's office located in Mechanicsburg, Pennsylvania. Farrell Plastic Surgery would also provide Dr. Sakol with employees and practice management services. The parties also agreed, among other terms, that Dr. Sakol would pay Farrell Plastic Surgery fifty percent (50%) of his collections minus certain costs which the parties would share. 2 The parties continued to abide by the terms of that agreement until on or about January 31, 2009, when Dr. Sakol unilaterally terminated the agreement and moved his practice of the Farrell Plastic Surgery office. Farrell alleges that Dr. Sakol has breached the agreement by failing to pay fifty percent (50%) of his collections for the period beginning on January 1, 2009 and ending on January 31, 2009. Furthermore, Dr. Sakol has breached the agreement by failing to pay Farrell Plastic Surgery fifty percent (50%) of his ongoing collections through the present. Despite demands by Farrell Plastic Surgery, Dr. Sakol has refused to compensate Farrell Plastic Surgery fifty percent (50%) of its collections for the time periods in question. III. QUESTION PRESENTED A. Whether the Motion for Coordination should be denied because the two lawsuits rely on different questions of law and fact. (Suggested Answer in the Affirmative). IV. ARGUMENT Under Pennsylvania law, in actions pending in different counties which involve common questions of law or fact or which arise from the same transaction or occurrence, any party may file a motion requesting that the court order coordination of the actions. Pa. R.C.P. 213.1(a). The court where the first filing of a complaint occurred is the forum for the coordination proceedings. Pa. R.C.P. 213.1(b); Digimatics, Inc. v. ABC Advisors, Inc., 760 A.2d 390 (Pa. Super. 2000). The decision to transfer a case to coordinate it with a related case proceeding simultaneously in another county lies within the sound discretion of the trial court. Geiger v. Rouse, 715 A.2d 454 (Pa. Super. 1998). In deciding whether and where to coordinate actions, the court must consider the totality of the circumstances and must examine the statutorily 3 enumerated factors. Wholsen/Crow v. Pettinato Associated Contractors & Engineers, Inc., 666 A.2d 701 (Pa. Super. 1995). Pursuant to Pa. R.C.P. 213.1(c), in determining whether to order coordination and which location is appropriate for the coordinated proceedings, the court shall consider, among other matters: (1) whether the common question of fact or law is predominating and significant to the litigation; (2) the convenience of the parties, witnesses and counsel; (3) whether coordination will result in unreasonable delay or expense to a party or otherwise prejudice a party in an action which would be subject to coordination; (4) the efficient utilization of judicial facilities and personnel and the just and efficient conduct of the actions; (5) the disadvantages of duplicative and inconsistent rulings, orders or judgments; (6) the likelihood of settlement of the actions without further litigation should coordination be denied. Pa. R.C.P. 213.1(c). 1. The Farrell Action and the Sakol Action involve differing questions of law and fact. The two lawsuits rely on different questions of law and fact. The Farrell Action in Dauphin County focuses on the parties' contract and the time period of January 2009. The Sakol Action in Cumberland County focuses on equitable claims, alleged HIPAA and privacy violations, and the time period of late 2009 well after Sakol left the practice in January 2009. The Sakol Action focuses on fraudulent acts committed by Erdman, a former employee of Farrell who converted funds from Farrell. The Cumberland County Lawsuit also focuses on H1PAA 4 violations and mailings sent out by Farrell to certain patients well after Sakol left the practice. The Cumberland County Lawsuit seeks injunctive relief and common law and equitable relief and is not focused on the contract that the parties entered into beyond referencing it to provide background information. Because the two lawsuits focus on different facts to support the causes of action, different time periods in questions, different witnesses, and request completely distinct damages and relief, the lawsuits should not be coordinated. 2. The convenience of the parties, witnesses, and counsel would be best served by leaving the actions separate. Both Farrell's counsel and Sakol's counsel have Harrisburg offices and it is more convenient for this case to be litigated in the Dauphin County Court of Common Pleas located in Harrisburg and not in Cumberland County. Furthermore, despite having a Cumberland County address, Farrell has chosen to initiate this litigation in Dauphin County, which is the location of Sakol's registered office address. Farrell also believes that many of the witnesses would find it equally convenient to litigate in Dauphin County as opposed to Cumberland County. In addition, Farrell believes that because the lawsuits rely on different questions of law and fact, it is premature for Sakol to assume that the lawsuits will rely on the same witnesses. Although the standard in a motion to transfer venue based on forum non conveniens is different than the standard in a motion to coordinate actions in different counties, it should be noted that Pennsylvania courts long recognize the right of a plaintiff to choose his or her own forum. Walls v. Phoenix Insurance Company, 979 A.2d 847 852 (Pa. Super. 2009) (citing Scola v. AC & S, Inc., 657 A.2d 1234 (Pa. 1995)). The law affords plaintiff a choice of where to file suit, presumes that plaintiffs consider their own convenience prior to choosing their forum, and courts should not lightly abrogate that choice. Id. (citing Catagnus v. Allstate Insurance Co., 864 A.2d 1259, 1264 (Pa. Super.2004)). In fact, the court where the first filing of a complaint 5 occurred is the forum for the coordination proceedings. Pa. R.C.P. 213.1(b); Digimatics, Inc. v. ABC Advisors, Inc., 760 A.2d 390 (Pa. Super. 2000). Therefore, Sakol's preference in filing the instant lawsuit in Dauphin County should be considered and his interests in litigating his lawsuit in Dauphin County are best served by keeping the actions separate. 3. Coordination would result in unreasonable delay and expense to Farrell. If the Coordination Motion is denied, both lawsuits may move along in a timely manner. It is no more likely that a combined lawsuit will result in less delay as the matter would become more complicated with additional causes of actions seeking conflicting remedies. The Farrell Action is a breach of contract action, with related counts in equity, focused on a specific timeframe in January 2009. The damages Farrell is seeking is limited to 50% of Sakol's collections for the time period ending on January 31, 2009. By contrast, the Sakol Action seeks damages in "an amount yet to be determined" for fraudulent conduct committed by the practice's former office manager. See Sakol's Feb. 3, 2010 Complaint at ¶¶ 52, 60 and 63. The remainder of the Sakol Action is focused around Farrell's post-termination conduct, including whether mailings that went out to Dr. Farrell's patients in September 2009, more than 8 months after Dr. Sakol terminated the parties' contract, constitute HIPAA or other violations. See Sakol Complaint at ¶ 45. The Sakol Action involves considerably more questions of law and fact than the Farrell action does. Farrell would incur unreasonable delay and expense in having his breach of contract action heard if Farrell is forced to litigate the Farrell Action while instituting the extensive discovery that would be required to be done in the Sakol Action. Unreasonable delay and expense is best avoided by leaving the actions separate. 6 4. The efficient utilization of judicial facilities and personnel and the just and efficient conduct of the actions is best served by the actions remaining separate. If the Coordination Motion is denied, both lawsuits may move along in a timely manner. It is no more likely that a combined lawsuit will result in less delay as the matter would become more complicated with additional causes of actions seeking conflicting remedies. Sakol argues in the Coordination Motion that because Farrell is involved in a conversion lawsuit on another docket in Cumberland County against his former employee Erdman, the Farrell Action should be consolidated with the Sakol Action. The fact that Farrell is involved in a conversion lawsuit against Erdman is not a common question of law or fact as to whether Sakol breached his contract with Farrell which is the crux of the Farrell Action in Dauphin County. Furthermore, whether the Cumberland County District Attorney's Office may prosecute Erdman has nothing to do with whether Sakol breached his contract with Farrell as well. Therefore, the efficient utilization of judicial facilities and personnel is best served by the actions remaining separate. 5. There are no disadvantages of duplicative and inconsistent rulings, orders or judgments if the actions remain separate. As the Dauphin County Lawsuit and the Cumberland County Lawsuit involve separate and disntict questions of law and fact, there would not be any duplicative or inconsistent rulings, orders, or judgments if the two lawsuits remain separate. Furthermore, Sakol argues that because Farrell has a conversion claim pending against Erdman in Cumberland County, the Farrell Action and the Sakol Action should be coordinated. Sakol argues that the Erdman Action would directly impact three of his causes of actions in his Complaint. If anything, this has to do with whether Sakol's action should be stayed pending the resolution of the Erdman action, not whether Farrell's breach of contract claims should be coordinated with Sakol's conversion and fraud claims. 7 6. The likelihood of settlement of the actions without further litigation should coordination be denied remains the same. As the Dauphin County Lawsuit and the Cumberland County Lawsuit involve different questions of law and fact, the chances of settlement remain the same whether or not they are coordinated. Farrell's position is that Sakol remains in breach of their contract and is due and owing 50% of his collections for the time period ending on January 31, 2009 pursuant to their contract. Because this is a separate and distinct issue than the claims raised in the Sakol Action, namely whether Farrell is responsible for Erdman's fraud and conversion and whether there are HIPAA violations, the likelihood of a global resolution is slim and would remain that way even if the actions are coordinated. V. CONCLUSION Plaintiff Farrell Plastic Surgery and Laser Center, P.C. respectfully requests that this Honorable Court deny Defendant's Motion for Coordination of Actions in Different Counties. In the alternative, if the Motion is to be granted, Plaintiff respectfully requests that the lawsuits be coordinated in Dauphin County as (1) it is equally convenient to the parties, the witnesses, and counsel; and (2) Plaintiff was the first party to file a complaint in Dauphin County and should not be denied it's choice of a forum to resolve this litigation. Respectfully submitted, SMIGEL, ANDERSON & SACKS, LLP Date: May 3, 2010 By: Peter M. Good, Esqu re - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff 8 FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Plaintiff, v. IN THE COURT OF COMMON PLEAS DAUPHIN COUNTY, PENNSYLVANIA No.2009-CV-15556-CV CIVIL ACTION -LAW PETER J. SAKOL, M.D., LLC, Defendant. JURY TRIAL DEMANDED CERTIFICATE OF SERVICE I, Peter M. Good, Esquire, attorney for the Plaintiff in the above-captioned matter, certify that I this day served a copy of the foregoing Plaintiffs Brief in Opposition to Defendant's Motion for Coordination of Actions in Different Counties upon the person(s) indicated below by depositing a copy of the same in the United States Mail, first class, postage prepaid, at Harrisburg, Pennsylvania, and addressed as follows: Bruce J. Warshawsky, Esquire Cunningham & Chernicoff, P.C. 2320 North 2nd Street Harrisburg, PA 17110 Attorney for Defendant Date: May 3, 2010 Charles Artz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 Attorney for Defendant SMIGEL, ANDERSON & SACKS, LLP B ~~N1~ Y• Peter M. Good, Esquire - ID #64316 Darryl J. Liguori, Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Plaintiff PETER J. SAKOL, M.D., LLC, IN THE COURT OF COMMON PLEAS Plaintiff/Counterclaim Defendant, CUMBERLAND COUNTY, PENNSYLVANIA N ~} p i ~ Yl v. No. 09=6023 ~=r ---± 3 ~__ FARRELL PLASTIC SURGERY AND CIVIL ACTION- LAW .~ - -- LASER CENTER, P.C., ,_~ _ Defendant/Counterclaim Plaintiff. JURY TRIAL DEMANDED - ~" .c- --_ STIPULATION TO STRIKE ~ --- r. It is hereby stipulated, by and between counsel for Peter J. Sakol, M.D., LL,C, and counsel for Farrell Plastic Surgery and Laser Center, P.C., that: (1) Peter J. Sakol, M.D., LLC filed an Answer with New Matter to Complaint on February 3, 2010 under Docket No. 2009-CV-15556-CV in the Dauphin County Court of Common Pleas before that docket was consolidated with the instant action; and (2) Paragraph 37(a) in that Answer with New Matter to Complaint is STRICKEN. CUNNINGHAM & CHERNICOFF, P.C. Date: . ~ ! to By: ru . tiVarshawsky, Esqu' ID # 58799 2320 North 2"d Street Harrisburg, PA 17110 (717) 238-6570 Attorney for Plaintiff/ Counterclaim Defendant SMIGEL, ANDERSON, & SACKS, L.L.P. Date: ~ ~ ~(~ By: Peter M. Good, Equire - ID #64316 4431 North Front Street, 3`d Floor Harrisburg, PA 17110 (717) 234-2401. Attorneys for Defendant/ Counterclaim Plaintiff SMIGEL, ANDERSON & SACKS, LLP River Chase Office Center 4431 North Front Street, 3`d Floor Hamsburg, PA 17110-1778 (717) 234-2401 Peter M. Good, Esquire pgood@sasllp.com Darryl J. Liguori, Esquire dliguori@sasllp.com Attorneys for Counterclaim Plaintiff PETER J. SAKOL, M.D., LLC, IN THE COURT OF COMMON PLEAS Plaintiff/Counterclaim Defendant, CUMBERLAND COUNTY, PENNSYLVANIA v. No. 09-6023 FARRELL PLASTIC SURGERY AND CIVIL ACTION -LAW LASER CENTER, P.C., DefendantlCounterclaim Plaintiff. JURY TRIAL DEMANDED CERTIFICATE OF SERVICE I, Peter M. Good, Esquire, attorney for the Defendant/Counterclaim Plaintiff in the above-captioned matter, certify that I this day served a copy of the foregoing Stipulation to Strike upon the person(s) indicated below by depositing a copy of the same in the United States Mail, first class, postage prepaid, at Harrisburg, Pennsylvania, and addressed as follows: Bruce J. Warshawsky, Esquire Cunningham & Chernicoff, P.C. 2320 North 2nd Street Harrisburg, PA 17110 Attorney for Counterclaim Defendant Charles Artz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 Attorney for Counterclaim Defendant SMIGEL, ANDERSON & SACKS, LLP Date: July 8, 2010 By: Peter M. Goo ,Esquire - ID #64316 Darryl J. Ligu ', Esquire - ID #91715 River Chase Office Center, 3rd Floor 4431 North Front Street Harrisburg, PA 17110 (717) 234-2401 Attorneys for Defendant/Counterclaim Plaintiff PETER J. SAKOL, M.D., LLC, IN THE COURT OF COMMON PLEAS OF PLAINTIFF/ :CUMBERLAND COUNTY, PENNSYLVANIA COUNTERCLAIM DEFENDANT V. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., DEFENDANT/ COUNTERCLAIM PLAINTIFF NO.09-6023 CIVIL ORDER OF COURT AND NOW, this 27th day of July, 2010, upon consideration of the Motion for Protective Order filed by Peter J. Sakol, M.D., LLC, IT IS HEREBY ORDERED AND DIRECTED that: 1. A Rule is issued upon the Defendant to show cause why the relief requested should not be granted; 2. The Defendant will file an answer on or before August 16, 2010; 3. If no answer to the Rule to Show cause is filed by the required date, the relief requested by Petitioner shall be granted upon the Court's receipt of a Motion requesting Rule be made Absolute. If the Defendant files an answer to this Rule to Show Cause, the Court will determine if further Order or hearing is necessary. 4. The Prothonotary is directed to forward said Answer to this Court. /~, M. L. Ebert, Jr., Bruce J. Warshawsky, Esquire Charles I. Artz, Esquire Attorneys for Plaintiff eter M. Good, Esquire Attorney for Defendant bas N .~ ~-, ~~ ._ ~. - N ~ , yT '~ ' -..t T ZS ~... - ~~ ~ ~~ ~ ~ _ W ~,_ ?~1~ ~-~ By the Court, I ~ „ ~.,. JUL 2 6 2010 PETER J. SAKOL, M.D., LLC, Plaintiff/Counterclaim Defendant v. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, PENNSYLVANIA NO: 09-6023 Defendant/Counterclaim Plaintiff PROTECTIVE ORDER GOVERNING CONFIDENTIALITY OF PROTECTED HEALTH INFORMATION AND OTHER DOCUMENTS TO BE PRODUCED AND INFORMATION OBTAINED IN DISCOVERY IT IS HEREBY ORDERED: 1. This Order shall govern all documents and other materials produced by parties or non-parties to this action which are designated "Confidential" or "Protected Health Information" (as that term is defined in the Privacy Regulations promulgated pursuant to the Health Insurance Portability and Accountability Act, 45 C.F.R. Parts 160 and 164), pursuant to Paragraph 2 and any copies, summaries, pleadings or transcripts containing quotations therefrom or references thereto (hereinafter the "designated material"). This Order shall also be intended to constitute a "qualified protective order" as described in 45 C.F.R. § 164.512(e). 2. Any party or non-party (hereinafter the "designating party") shall have the right to designate as confidential any document that contains peer review information, proprietary business information or information that has been maintained by the designating party in a confidential fashion by marking such document "CONFIDENTIAL MATERIAL" or other comparable language. Documents that contain non-public, competitively sensitive information may be designated "CONFIDENTIAL, COUNSEL ONLY" or other comparable language. Any party or non-parry (also the "designating party") shall have the right to designate as Protected Health Information any document that contains information defined by the Privacy Regulations by marking such document "PROTECTED HEALTH INFORMATION." 3. The fact that any information is disclosed or produced in discovery or trial herein shall not be construed as a waiver in any other context or proceeding before any court, agency or tribunal as evidence of whether such information is or is not confidential or proprietary or whether it constitutes Protected Health Information. 4. Any party preparing, serving or filing any document containing or referring to designated material shall mark such documents "Confidential," "Confidential, Counsel Only" or "Protected Health Information" in accordance with Paragraph 2 of this Order. With respect to a deposition at which designated material is the subject of examination, any party or third party may invoke this Order by stating on the record during the taking of the deposition that some or all of the examination is confidential or Protected Health Information. All copies of the transcript of a deposition or the exhibits to a deposition which a party or third party has designated Confidential or Protected Health Information in whole or in part shall be marked by the court reporter with the applicable legend set forth in Paragraph 2 of this Order. 5. Designated material shall not be delivered, exhibited, disclosed or communicated, to anyone other than the following persons: (a) counsel of record for any party in this action; (b) paralegal, stenographic, clerical and other employees of counsel of record in this action; (c) court reporters and employees of court reporters engaged by counsel to record and transcribe testimony in connection with this case; 2 (d) independent experts and consultants employed by counsel for the parties to assist in the preparation or trial of this case; (e) directors, officers and employees of any party in this action who are being advised by counsel to the extent that a particular disclosure of specific designated material is necessary with respect to the legal advice being rendered; (fj any person from whom testimony is taken or to be taken in this action ("witness"), provided that such person may only be shown copies of designated material during his or her testimony or in the actual course of preparation therefore and may not retain any designated material; (g) the Court and employees of the Court; and (h) documents designated "Confidential, Counsel Only" shall not be delivered, exhibited, disclosed or communicated to persons specified in subparagraph 5(e) except insofar as such persons may be witnesses pursuant to subparagraph 5(f). 6. Documents produced in this action, whether or not containing designated material, shall be used solely for the purpose of conducting this action and not for any business or other purpose. Designated material may be used in this action as follows: (a) in materials filed with the Court under seal which shall bear on the cover of the sealed envelope the applicable legend specified in Paragraph 2; (b) during the course of a deposition provided that confidentiality is preserved; (c) in open court to the extent necessary in argument of any pretrial motions referring to designated materials; and (d) at trial or at any hearing held pursuant to this action. 3 7. Designated material shall not be disclosed to persons specified in subparagraphs 5(d), (e) and (f) until such persons have executed a written AGREEMENT TO BE BOUND BY PROTECTIVE ORDER, in the form annexed hereto as Exhibit "A", or have agreed to abide by the terms of this Order on the record of his or her deposition. Upon final termination of this action, each party and person shall return all designated material, including all copies thereof, to the designating party. Upon termination of this action and all appeals therefrom, all documents and materials of any designating party filed with the Court pursuant to Paragraph 6 of this Order shall be returned directly to the designating party or permanently expunged from the Court's records at the option of the designating party. 9. No part of the restrictions imposed by this Order may be terminated, except by stipulation executed by counsel of record for the designating party or in accordance with Paragraph 10. The provisions of this Order, insofar as they restrict the communication, treatment and use of designated material shall continue to be binding after the termination of this action, unless the Court orders otherwise. 10. Any party may object to the confidentiality or Protected Health Information designation of any designated material by serving written notice of objection on all parties, specifying with reasonable particularity the materials to which objection is made. The party maintaining the confidential or Protected Health Information shall file a motion for determination by the Court within 10 days. The issue of whether the material is confidential or Protected Health Information shall be preserved pending resolution of the issue by the Court. 11. The fact that any information is disclosed or produced in discovery or offered or admitted into evidence at any hearing or trial shall not be construed as a waiver in any other 4 context or proceeding before any court, agency or tribunal as evidence of whether such information is or is not confidential, proprietary or Protected Health Information. BY ORDER: Date: J. F:\Home\BJW\DOCS\SAKOL.PETER\6-18-10 Omnibus Protective Order-Confiden6at Documents and PHLwpd 5 EXHIBIT `A' PETER J. SAKOL, M.D., LLC, IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY, Plaintiff/Counterclaim Defendant PENNSYLVANIA v. NO: 09-6023 FARRELL PLASTIC SURGERY AND LA5ER CENTER, P.C., Defendant/Counterclaim Plaintiff AGREEMENT TO BE BOUND BY PROTECTIVE ORDER I hereby certify that I have read the attached Protective Order in the above-captioned case, and that I understand that I may not disclose any materials marked "Confidential" or "Protected Health Information" to any persons not described in Paragraph 5 of the Order under the circumstances provided therein. I recognize that I am bound by the terms of that Order and I agree to be legally bound thereby and comply with those terms. I hereby consent to be subject to the personal jurisdiction of the above Court in respect to any proceeding related to the attached Order. Date: Signature F:U-Iome\BJWIDOCS\SAKOL.PET'ER\ti-18-10 Agreement to Be Bound by Protective Order.wpd 1 Bruce J. Warshawsky, Esquire PA Supreme Court ID# 58799 CUNNINGHAM & CHERNICOFF, P.C. 2320 N. Second. St. Harrisburg, PA 17110 L.k D5-0rFICE :,'H0N0TAF\ ,, ku1Q S - ' i ; PIS 1: 1'P ;t Z=91ER1.AH0 T'41-11 41 .- IIN'SYLVANIA 1 Mailing Address: P.O. Box 60457 Harrisburg, PA 17106-0457 (717) 238-6570 PETER J. SAKOL, M..D., LLC IN THE CUMBERLAND COUNTY COURT OF COMMON PLEAS Plaintiff/Counterclaim Defendant/Movant CIVIL ACTION - LAW V.. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., NO. 09-6023 Defendant/Counterclaim Plaintiff/Respondent MOTION TO MAKE RULE ABSOLUTE AND NOW COMES Plaintiff/Counterclaim Defendant/Movant, Peter J. Sakol, M.D., LLC ("Dr. Sakol"), by and through its attorneys, Cunningham & Chernicoff, P.C. and Artz Health Law, and files the within Motion to Make Rule Absolute, and in support thereof avers as follows: 1. On July 23, 2010, Dr. Sakol filed a Motion for Protective Order (the "Motion")pursuant to Pa.R.C.P. 208.1 and 4012(a)(9) and Cumberland County Rules of Procedure 208.3-4001-1 seeking to limit the scope of discovery to protect the confidentiality of both parties' clients and their respective Private Health Information ("PHI"). 2. As stated in the Motion, Defendant's counsel has reviewed the proposed order and the Motion and has indicated that they concur in the Motion and the form and content of the proposed order. On July 27, 2010, the Honorable M.L. Ebert, Jr. issued a Rule to Show Cause, requiring Respondent to show cause why the Motion for Protective Order should not be granted, returnable twenty (20) days from service ("Rule"). 3. The Office of the Prothonotary mailed copies of the Rule to counsel for both parties on the same day. 4. No Respondent has filed a response to the Rule as of September 15, 2010. WHEREFORE, Plaintiff/Counterclaim Defendant/Movant, Peter J. Sakol, M.D., LLC, by and through by and through its attorneys, Cunningham & Chernicoff, P.C. and Artz Health Law, respectfully requests this Honorable Court to issue an Order making its July 27, 2010 Rule to Show Cause absolute, and entering the Protective Order in this case. CUNNINGHAW ,& CIYERN?OFF, P.C. By Bruge'J. Warshaws squire Afto/rney I.D. No. 99 P.O. Box 60457 2320 North Second Street Harrisburg, PA 17110-0457 (717) 238-6570 Dated: F: Home,WW`DOCS',SAKOL.PETE R`,Cumberland County.Mot. Rule Absolute.wpd VERIFICATION I, Bruce J. Warshawsky, Esquire, Counsel to Movant, hereby verify that the statements made in the foregoing Motion to Make Rule Absolute are true and correct to the best of my knowledge, information and belief, and that false statements herein are made subject to the penalties of 18 Pa. C.S.A. §4904 relating to unsworn falsification to auth9fities. Date: Bruce J. Warshawsky CERTIFICATE OF SERVICE I, Julieanne Ametrano, Legal Assistant, of the law firm of Cunningham & Chemicoff, P.C., hereby certify that a true and exact copy of the Motion to Make Rule Absolute will be served by electronic means and/or first class U.S. Mail on the following parties indicated: Peter M. Good, Esquire Darryl J. Liguori, Esquire Smigel, Anderson & Sacks, LLP River Chase Office Center 4431 North Front Street Third Floor Harrisburg, PA 17110 Date: September 16, 2010 Charles Ariz, Esquire 200 North Third Street Suite 12B Harrisburg, PA 17101 t Ju ieanne Ametrano ~ PETER J. SAKOL, M..D., LLC Plaintiff SEP 2 ®Luiu IN THE CUMBERLAND COUNTY COURT OF COMMON PLEAS CNIL ACTION -LAW v. FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Defendant NO. 09-6023 ORDER AND NOW, this ~.~~ day of S~.p ~ , 2010, in consideration of the attached Motion to Make Rule Absolute, IT IS HEREBY ORDERED that the Rule to Show Cause issued July 27, 2010 is hereby made ABSOLUTE and the Protective Order is hereby ENTERED. `~~ J. C~ ~,:-r s D -~) _.,~ ~ ;, 1 a PETER J. SAKOL, M..D., LLC IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY PENNSYLVANIA Plaintiff/Counterclaim Defendant CIVIL ACTION - LAW . o a --? V. r M r-) FARRELL PLASTIC SURGERY AND `' , LASER CENTER, P.C., NO. 09-6023 C- - , =: c-a Defendant/Counterclaim Plaintif f CERTIFICATE PREREQUISITE TO SERVICE OF A SUBPOENA PURSUANT TO RULE 4009.22 As a prerequisite to service of a subpoena for documents and things pursuant to Rule 4009.22, Plaintiff/Counterclaim Defendant certifies that: (1) a notice of intent to serve the subpoena with a copy of the subpoena attached thereto was mailed or delivered to each party at least twenty days prior to the date on which the subpoena is sought to be served, (2) a copy of the notice of intent, including the proposed subpoena, is attached to this certificate, (3) no objection to the subpoena has been received, and Date (4) the subpoena which will be served is identical to the subpoena which is attached to the notice of intent to serve the subpoena. ichola A. F eIli, Esquire Attorney for Peter J. Sakol, M.D., LLC PETER J. SAKOL, M..D., LLC IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY PENNSYLVANIA Plaintiff/Counterclaim Defendant CIVIL ACTION - LAW , V. 'ma :Z rn =::0 rn n - x -O~ FARRELL PLASTIC SURGERY AND W? ? 7-0 ? LASER CENTER P.C., NO. 09-6023 < Defendant/Counterclaim Plaintiff d'? .`.' CERTIFICATE PREREQUISITE TO SERVICE OF A SUBPOENA PURSUANT TO RULE 4009.22 As a prerequisite to service of a subpoena for documents and things pursuant to Rule 4009.22, Plaintiff/Counterclaim Defendant certifies that: (1) a notice of intent to serve the subpoena with a copy of the subpoena attached thereto was mailed or delivered to each party at least twenty days prior to the date on which the subpoena is sought to be served, (2) a copy of the notice of intent, including the proposed subpoena, is attached to this certificate, (3) no objection to the subpoena has been received, and (4) the subpoena which will be served is identical to the subpoena which' attached to the notice of intent to serve the subno-ena. ? J Date: 101 -0 ?) -/ 0 Nicholas'A. Tdnelli, Esquire Attorney for Peter J. Sakol, M.D., LLC PETER J. SAKOL, M..D., LLC Plaintiff/Counterclaim Defendant V. IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY PENNSYLVANIA FARRELL PLASTIC SURGERY AND LASER CENTER, P.C., Defendant/Counterclaim Plaintiff CIVIL ACTION - LAW NO. 09-6023 T =m M n r- -o , r 00 ,c 7- 4 3 O CERTIFICATE PREREQUISITE TO SERVICE OF A SUBPOENA PURSUANT TO RULE 4009.22 As a prerequisite to service of a subpoena for documents and things pursuant to Rule 4009.22, Plaintiff/Counterclaim Defendant certifies that: (1) a notice of intent to serve the subpoena with a copy of the subpoena attached thereto was mailed or delivered to each party at least twenty days prior to the date on which the subpoena is sought to be served, (2) a copy of the notice of intent, including the proposed subpoena, is attached to this certificate, (3) no objection to the subpoena has been received, and (4) the subpoena which will be served is identical to the subpoena which is to the notice of intent to serve the subpoena. / Date: /,0-@ 3 "/ D Ni6holas A. Vqfielli, Esquire - Attorney for Peter J. Sakol, M.D., LLC PETER J. SAKOL, M..D., LLC IN THE COURT OF COMMON PLEAS CUMBERLAND COUNTY PENNSYLVANIA Plaintiff/Counterclaim Defendant CIVIL ACTION - LAW V. Off. r'n Q7 C cJ .! , FARRELL PLASTIC SURGERY AND : N om, LASER CENTER, P.C., NO. 09-6023 ? - co ) Ica n Defendant/Counterclaim Plaintiff ' '---- CERTIFICATE PREREQUISITE TO SERVICE OF A SUBPOENX, PURSUANT TO RULE 4009.22 As a prerequisite to service of a subpoena for documents and things pursuant to Rule 4009.22, Plaintiff/Counterclaim Defendant certifies that: (1) a notice of intent to serve the subpoena with a copy of the subpoena attached thereto was mailed or delivered to each party at least twenty days prior to the date on which the subpoena is sought to be served, (2) (3) (4) a copy of the notice of intent, including the proposed subpoena, is attached to this certificate, no objection to the subpoena has been received, and the subpoena which will be served is identical to the subpoena to the notice of intent to serve the subpoena. Date: li-a b -/U Nialfolas A: Fanblli, Esquire Attorney for Peter J. Sakol, M.D., LLC is attached PETER J. SAKOL, M.D., LLC, : IN THE COURT OF COMMON PLEAS Plaintiff/Counterclaim Defendant, : CUMBERLAND COUNTY, PENNSYLVANIA V. No. 09-6023 - ^- r-' FARRELL PLASTIC SURGERY AND CIVIL ACTION - LAW LASER CENTER, P.C., ? Defendant/Counterclaim Plaintiff. JURY TRIAL DEMANDED Y_ c. n ° ? c3 r' JOINT PRAECIPE TO WITHDRAW WITH PREJUDICE - TO THE PROTHONOTARY: Please mark both the Complaint and Counterclaim of each party as withdrawn with prejudice. This is a Joint Praecipe executed by counsel for both the Plaintiff/Counterclaim Defendant and the Defendant/Counterclaim Plaintiff. Respectfully submitted, SMIGEL, ANDERSON & SACKS, L.L.P. Date: l /r ( By: - Peter M. Good, Esquire I.D. Number: 64316 River Chase Office Center 4431 North Front Street Harrisburg, PA 17110-1778 (717) 234-2401 Attorneys for Defendant/ Counterclaim Plaintiff CUNNINGHAM & CHERNICOFF, P.C. Date: BY ` rI.D. Number: 58799 2320 North 2nd Street Harrisburg, PA 17110 Attorney for Plaintiff / Counterclaim Defendant