Preview
ELECTRONICALLY FILED
Superior Court of California
McDERMOTT WILL & EMERY LLP County of Santa Barbara
THOMAS A. RYAN (State Bar No. 143148) Darrel E.E. Parker,
Parker, Executive Officer
tryan@mwe.com 4/17/2017 1:16:43 PM
4/17/20171:16:43
JASON D. STRABO (State Bar No. 246426) By: John Tennant, Deputy
By:
jstrabo@mwe.com
JESSICA A. MARIANI (State Bar No. 280748)
jmariani@mwe.c0m
2049 Century Park East, Suite 3800
Los Angeles, CA 90067
Telephone: 310.277.4110
Facsimile: 310.277.4730
Attorneys for Defendant
21ST CENTURY ONCOLOGY OF CALIFORNIA
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF SANTA BARBARA — SANTA MARIA DIVISION
DIGNITY HEALTH, a California nonprofit CASE NO. 17CV00920
public benefit corporation, dba MARIAN
REGIONAL MEDICAL CENTER, Assigned for all purposes to Judge James F.
Rigali
Plaintiff,
21ST CENTURY ONCOLOGY 0F
v. CALIFORNIA’S NOTICE OF MOTION
AND MOTION TO STAY COURT
COASTAL RADIATION ONCOLOGY PROCEEDING PENDING
MEDICAL GROUP, INC, a California RESOLUTION OF ALTERNATE
professional corporation; CASE H. DISPUTE RESOLUTION;
KETTING, M.D., an individual; JEFFREY K. MEMORANDUM OF POINTS AND
WU, M.D., an individual; 215T CENTURY AUTHORITIES; DECLARATION OF
ONCOLOGY OF CALIFORNIA, a JESSICA A. MARIANI
California corporation; CENTRAL COAST
MEDICAL ONCOLOGY CORR, a Hearing
California corporation; and DOES 1-25,
Date: June 6, 2017
Defendants. Time: 8:30 am.
Dept: 2
Action Filed: February 21, 2017
NOTICE OF MOTION AND MOTION TO STAY
TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:
PLEASE TAKE NOTICE that, on June 6, 2017 at 8:30 a.m., or as soon thereafter as the
matter can be heard, in Department 2 of the above—entitled Court, located at 312C East Cook
Street, Santa Maria, California 93456, defendant 2151 Century Oncology of California (“2151
Century”) will and hereby does move this Court for an order staying the above-entitled action
pending resolution of the pending alternate dispute resolution (“ADR”) proceedings between
defendants 21SI Century and Central Coast Medical Oncology Corp. (“Central Coast”).
This motion is made pursuant to California Code of Civil Procedure section 187 on the
grounds that the ADR proceedings that are already pending between two of the parties to this
10 litigation arises from the same facts, and will address the same issues, and, thus, a stay of this
LLP
11 proceeding until the ADR is resolved will promote judicial efficiency and avoid duplicative
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12 efforts that may lead to inconsistent results.
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13 The motion is based on this Notice, the attached Memorandum of Points and Authorities
14 filed concurrently herewith, the Declaration of Jessica Mariani filed herewith, the pleadings and
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15 other papers filed in this action, and such oral argument as the Court may permit. This is filed
16 concurrently with 215‘ Century’s Demurrer to the Complaint.
17 Dated: April 17, 2017 McDERMOTT WILL & EMERY LLP
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18
By: I
19 JEééICA AJMARIANI
Attorneys for Defendant
20 21ST CENTURY ONCOLOGY OF
CALIFORNIA
21
22
24
25
26
27
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NOTICE OF MOTION AND MOTION TO STAY
TABLE OF CONTENTS
Page
RELEVANT FACTS ..........................................................................................................
1
II. THIS COURT SHOULD EXERCISE ITS INHERENT AUTHORITY TO STAY
THIS COURT PROCEEDING ........................................................................................... 2
III. CONCLUSION ...................................................................................................................
3
DIGNITY SERVED ITS COMPLAINT IN THIS MATTER ON 218T
CENTURY ON MARCH 6, 2017 ......................................................................................
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LLP
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1 TABLE OF AUTHORITIES
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Page(s)
La.)
State Cases
Bailey v. Fosca 01'] C0,, Ltd,
5 216 Cal. App. 2d 813(1963) ....................................................................................................... 3
6 Freiberg v. City ofMission Viejo,
33 Cal. App. 4th 1484 (1995) ...................................................................................................... 3
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NOTICE OF MOTION AND MOTION TO STAY
MEMORANDUM OF POINTS AND AUTHORITIES
In the event the Court does not grant Defendant 2]SI Century’s concurrently filed demurrer
to plaintiff Dignity Health’s (“Dignity”) Complaint against 21St Century respectfully requests that
the Court, in the alternative, stay this proceeding pending resolution of the already-pending
alternate dispute resolution (“ADR”) between defendants 21S1 Century and Central Coast arising
out of the same issues and dispute. Dignity’s central allegation in this lawsuit _ that 215' Century
wrongfully opened a facility in Lompoc, California that competes with the Mission Hope Cancer
Center — should be subject to the arbitration provisions in the Ground Lease between Dignity and
MHCC, LLC and the arbitration agreement in the contract between Central Coast and 2151
Century. The ground lease that has allegedly been breached also contains an arbitration
LLP
provision. Compl. 1] 14, Ex. A at § 29. In its Complaint, Dignity also references and attaches a
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contract between 21“ Century and Central Coast that not only expressly authorizes the facility in
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Lompoc, but also contains an arbitration provision. See Compl. fl 24, Ex. D at §§2.13(a), 1 1.1.
MOI Indeed, Central Coast and 21SI Century are already addressing a dispute arising out of the exact
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(, same facts as this case in ADR. One can only surmise that Dignity filed its Complaint, asserting
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arguments that are aligned with those of Central Coast (and MHCC, LLC, which is alleged to
own the Mission Hope Cancer Center) in order to avoid arbitrating this dispute. However, there
is no reason to duplicate efforts with arbitration and/or risk potentially conflicting decisions by
simultaneously addressing the same issues in multiple proceedings. This proceeding should,
therefore, be stayed until resolution of the ADR that is already underway between 21St Century
and Central Coast.
I. RELEVANT FACTS
When boiled down to its essence, Dignity’s Complaint in this action alleges that 2151
Century has violated the “disqualified person” provision in a ground lease between Dignity and
MHCC, LLC (which Dignity alleges is incorporated into the sublease between 2 151Century and
Central Coast) by developing and running a facility in Lompoc that competes with MHCC LLC’s
Mission Hope Cancer Center.
The ground lease between Dignity and MHCC, LLC contains an arbitration provision.
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NOTICE OF MOTION AND MOTION TO STAY
Compl. 1] 14, Ex. A at § 29.
Dignity attaches to its Complaint in this matter an Amended and Restated Management
Services Agreement between 21SI Century and Central Coast (“MSA”). Comp]. fl 24, Ex. D.
That MSA agreement between 215‘ Century and Central Coast contains a provision that explicitly
contemplates and authorizes the facility developed and run by 2151 Century and Central Coast in
Lompoc. Section 2.13(a) states that “nothing in this Agreement shall prohibit or restrict [213‘
Century] or any of its Affiliates from providing services, including but not limited to services
consistent with the Management Services to be provided hereunder. ..(4) at the medical facility to
be located in Lompac (sic), California which is currently under development by [2151 Century]
and Coastal.” Compl. 1124, Ex. D at § 2.13(a).
Moreover, the MSA between 215‘ Century and Central Coast contains a mediation and
arbitration provision at Section 11.1, which provides that “[i]n the event of any controversy or
claim, whether based on contract, tort, statute, or other legal or equitable theory (including but not
limited to any claim of fraud, misrepresentation, or fraudulent inducement) arising out of or
MCDFRHLH
related to this Agreement. . .the Parties agree to submit the dispute to mediation.” Compl. 1124,
Ex. D at § 11.1(a), (b). The MSA between 21St Century and Central Coast further provides that in
the event they cannot resolve their dispute in mediation, “the dispute shall be resolved by
arbitration...” Comp]. 1124, Ex. D at § 11.1(b),
On February 27, 2017, in response to correspondence from Central Coast attaching
notices of breaches of the sublease from MHCC, LLC and Dignity, counsel for 21“ Century
requested mediation with Central Coast, pursuant to the MSA. Declaration of Jessica Mariani
(“Mariani Decl.”), 112. Unbeknownst to 21SI Century, on February 21, 2017, Dignity had filed a
Complaint against both parties to the mediation — 2151 Century and Central Coast — as well as
other defendants. Mariani Decl. fl 3. That Complaint was not served on 21St Century until March
6, 2017. Id.
[1. THIS COURT SHOULD EXERCISE ITS INHERENT AUTHORITY TO STAY
THIS COURT PROCEEDING
The Court has the inherent power to stay this proceeding pending the outcome of the
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NOTICE OF MOTION AND MOTION TO STAY
related ADR proceeding, where that stay would promote judicial efficiency. Freiberg v. City of
Mission Viejo, 33 Cal. App. 4th 1484, 1489 (1995) (“Trial courts generally have the power to stay
proceedings in the interests of justice and to promote judicial efficiency”) (citations omitted); see
also Bailey v. Fosca Oil Ca, Ltd, 216 Cal. App. 2d 813, 817-18 (1963) (affirming trial court
authority to stay proceedings).
The mediation (and likely arbitration) between 21SI Century and Central Coast will deal
with the same issues raised in Dignity’s Complaint, concerning 21SI Century’s alleged breach ofa
provision in the Ground Lease and alleged interference with prospective economic advantage.
Both the mediation (and likely arbitration), 0n the one hand, and this court proceeding, on the
other, will deal with interpreting the same contract language concerning the “disqualified person”
provision in the Ground Lease between MHCC, LLC and Dignity Health, and the same dispute
arising thereunder. This is made clear by the February 27, 2017 letter from counsel for 2151
Century, to counsel for Central Coast, requesting mediation to resolve the dispute arising from
notices of breaches sent by MHCC, LLC and Dignity Health concerning the “disqualified person”
provision ofthe Ground Lease. Mariani Decl. 112‘
Since the ADR procedure is already underway, and this court proceeding has only just
begun, staying the court proceeding will promote efficiency by preventing duplicative litigation
that could also lead to inconsistent results.
III. CONCLUSION
Since Dignity’s Complaint and the mediation between 21SI Century and Central Coast
arise out of the same dispute, and concern the same contractual language, 21“ Century
respectfully requests that this Court stay this proceeding pending resolution of the ADR
procedure already underway between 21SI Century and Central Coast.
Dated: April 17, 2017 McDERMOTT WILL & EMERY LLP
By:
JEéSICA\7(. MARIANI
Attorneys for Defendant
21ST CENTURY ONCOLOGY OF
CALIFORNIA
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NOTICE OF MOTION AND MOTION TO STAY
DECLARATION OF JESSICA A. MARIANI
1, Jessica A. Mariani, declare as follows:
1. I am an attorney duly licensed to practice law in the State of California. I am an
associate in the law firm of McDermott Will & Emery LLP, counsel for defendant 21St Century
Oncology of California (“21St Century”) in the above-entitled action. I make this declaration in
support of 21S! Century’s Motion to Stay. If called as a witness, I could and would competently
testify to the following facts, which are known to me of my own personal knowledge and upon
the records and files maintained by McDermott Will & Emery LLP in the regular course of its
representation of 21St Century.
2. On February 27, 2017, in response to correspondence from Central Coast attaching
LLP notices of breaches of the sublease from MHCC, LLC and Dignity Health concerning the
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“disqualified person” provision of the Ground Lease, counsel for 21SI Century requested
mediation with Central Coast, pursuant to the Amended and Restated Management Services
Agreement between 21St Century and Central Coast Medical Oncology Corp.
DERMOTE
3. Dignity served itsComplaint in this matter on 21St Century on March 6, 2017.
MK
I declare under penalty of perjury under the laws of the State of California that the
foregoing is true and correct.
Executed this 17th day of April, 2017 in Los Angeles, California.
JE§SICA KMARIANI
DM_US 81109886-20959760014
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NOTICE OF MOTION AND MOTION TO STAY
PROOF OF SERVICE
I, Susanne V. Woods, declare:
I am employed in Los Angeles County, California. Iam over the age of eighteen years
and not a party to the within-entitled action. My business address is 2049 Century Park East,
Suite 3800, Los Angeles, California 90067-3218. On April 17, 2017, I served a copy ofthe
within document(s):
218T CENTURY ONCOLOGY OF CALIFORNIA’S NOTICE OF MOTION AND
MOTION TO STAY COURT PROCEEDING PENDING RESOLUTION OF
ALTERNATE DISPUTE RESOLUTION; MEMORANDUM OF POINTS AND
AUTHORITIES; DECLARATION OF JESSICA A. MARIANI
by transmitting via email the document(s) listed above to the email address(es) set
fonh below on this date before 5:00 pm.
LH’
by placing the d0cument(s) listed above in a sealed envelope with postage thereon
EMEIU fully prepaid, in the United States mail at Los Angeles, California addressed as set
fonh below.
James Turken
Kathleen Hipps
Eisner J affee, APC
9601 Wilshire Boulevard, Suite700
Beverly Hills, CA 90210
Jturken@eisnerlaw.c0m
kcemiglia@eisnerlaw.com
I am readily familiar with the firm‘s practice of collection and processing correspondence
for mailing. Under that practice it would be deposited with the US. Postal Service on that same
day with postage thereon fully prepaid in the ordinary course of business. I am aware that on
motion of the party served, service is presumed invalid if postal cancellation date or postage
meter date is more than one day after date of deposit for mailing in affidavit.
I declare under penalty of perjury under the laws of the State of California that the above
is true and correct.
Executed on April 17, 2017, at Los Angeles, California.
Susanne V. Woods
DM7US 81286938-] 095976 0014
PROOF OF SERVICE