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Medicine and Long Term Care Associates LLLC v. Khurshid

Superior Court of Rhode Island

March 29, 2016

MEDICINE AND LONG TERM CARE ASSOCIATES, LLC. Plaintiff,
v.
SHAHZAD KHURSHID Defendant.

Providence County Superior Court

For Plaintiff: Anthony J. Gianfrancesco, Esq.

For Defendant: Kathleen M. Hagerty, Esq.

DECISION

SILVERSTEIN, J.

The Plaintiff, Medicine and Long Term Care Associates, LLC. (MLTC), is a Rhode Island limited liability company; its principal place of business is in Cranston, Rhode Island. The Defendant, Doctor Shahzad Khurshid (Khurshid), is a resident of North Kingstown, Rhode Island. This Court has jurisdiction over the subject matter of the instant dispute pursuant to G.L. 1956 § § 8-2-13, 8-2-14, and 9-30-1.

I

Facts and Travel

MLTC was organized for the purpose of providing health care services and has been providing health care services-primarily to geriatric patients in nursing homes-since its date of incorporation. In May of 2009, MLTC and Khurshid entered into an Association Agreement (Agreement) whereby Khurshid agreed to provide "services for the benefit of the patients of MLTC on a mutually agreed upon schedule." Agreement, 1. The Agreement guaranteed Khurshid compensation in exchange for his services, but also contained an "Exclusivity and Non-Competition" clause. Id. at 3. Under the Exclusivity and Non-Competition clause, Khurshid was prohibited from soliciting or attempting to solicit MLTC employees, agents, contractors, referral sources, or patients for two years after termination or expiration of the Agreement. Additionally, under the Exclusivity and Non-Competition clause, and for two years after termination or expiration of the Agreement, Khurshid was prohibited from causing or inducing any employee, agent, supplier, vendor, contractor, referral source, or patient of MLTC to terminate or suspend its business with MLTC. Finally, under the Exclusivity and NonCompetition clause, and for two years after termination or expiration of the Agreement, Khurshid was prohibited from maintaining an office practice within nine miles of MLTC's principal place of business.

In addition to the above-described Exclusivity and Non-Competition clause, the Agreement contained the following acknowledgement: "Khurshid[] acknowledges that irreparable harm will result to MLTC's Private Practice upon breach of the covenants contained in the Confidentiality and Non-Solicitation sections of this Agreement. In addition to all other available remedies, MLTC may obtain injunctive relief to enforce the specific covenants contained herein." Id.

Khurshid remained associated with MLTC until at least December of 2014. As an associate, Khurshid was assigned patients in nursing home facilities, and Khurshid provided care to those patients.

On December 28, 2014, Khurshid sent a letter to MLTC informing them of his intent to terminate the Agreement. On or about January 1, 2015, MLTC received notice from the John Clarke Retirement Center of its intent to terminate its contract with MLTC.[1] On or about January 7, 2015, MLTC sent a letter to Khurshid informing him that it had "come to the attention of MLTC that [Khurshid] may have engaged in some activity which is in direct violation of the Exclusivity and Non-Competition clause in the [] Agreement." Letter from Atty. Gianfrancesco to Khurshid dated Jan. 7, 2015. The letter went on to state that Khurshid was "directed to cease and desist in any such activity, " and that Khurshid's "failure to do so will result in MLTC taking further appropriate action pursuant to the [] Agreement." Id.

On February 3, 2015, MLTC filed a Complaint in Superior Court, wherein it named Khurshid as Defendant and alleged the following: Unfair Competition (Count I), Breach of Fiduciary Duty (Count II), Tortious Interference with Advantageous Relations (Count III), and Tortious Interference with Prospective Contractual Relations (Count IV). In addition to compensatory damages, attorney's fees, interests, and costs, MLTC, in its Complaint, prayed for the following relief: a declaratory judgment stating that Khurshid (1) engaged in unfair competition, (2) breached his fiduciary duties, (3) tortiously interfered with advantageous business relations, and (4) tortiously interfered with prospective contractual relations; injunctive relief prohibiting Khurshid from using business relationships established-and confidential information developed-while he was associated with MLTC; an award of punitive damages; and an award of exemplary damages pursuant to G.L. 1956 § 6-41-4. On July 22, 2015, Khurshid filed an Answer in response to MLTC's Complaint. Khurshid's Answer denies Counts I-IV, raises eleven separate affirmative defenses, and includes multiple counterclaims.

This Decision will address only MLTC's above-mentioned prayer for injunctive relief. Although the Court finds that MLTC has alleged facts and presented evidence which otherwise might entitle it to injunctive relief, for ...


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