COMPLAINT

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Lewis Roca Rothgerber Christie LLP

201 East Washington Street, Suite 1200

Phoenix, AZ 85004-2595

Mary Ellen Simonson (State Bar No. 009298)

Direct Dial: 602.262.5317

Direct Fax: 602.734.3868

Email: msimonson@lrrc.com

Bruce E Samuels (State Bar No. 015996)

Direct Dial: 602.262.0216

Direct Fax: 602.734.3859

Email: bsamuels@lrrc.com

Laura Pasqualone (State Bar No. 028360)

Direct Dial: 602.262.5362

Direct Fax: 602.734.3778

Email: lpasqualone@lrrc.com

Attorneys for Plaintiffs

UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

Aric Burke and Vaughn Ward,

Plaintiffs,

v.

USPI Holding Company, Inc., USPI Group

Holdings, Inc. and USP Texas LP,

Defendants.

Case No.

VERIFIED COMPLAINT FOR

DECLARATORY JUDGMENT AND

INJUNCTIVE RELIEF

Aric Burke and Vaughn Ward (collectively, “Plaintiffs”), for their Verified Complaint

against Defendants USPI Holding Company, Inc. (“USPI Holding”), USPI Group Holdings,

Inc. (“USPI Group”) and USP Texas LP (collectively, “Defendants”), allege as follows:

NATURE OF ACTION

1. Plaintiffs bring this action and respectfully request a declaratory judgment

regarding the unenforceability of restrictive covenants contained within certain stock option

agreements between Mr. Burke and USPI Holding and/or USPI Group, and Mr. Ward and

USPI Holding, each of which purports to prohibit Plaintiffs for a period of one year

following termination of their employment from (a) engaging in activity competitive with

USPI Holding and/or USPI Group or any of their subsidiaries anywhere in the world;

(b) undertaking any planning for any business competitive or potentially competitive with

USPI Holding and/or USPI Group or any of their subsidiaries anywhere in the world, (c)

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 1 of 17
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soliciting for employment or hiring any employees or independent contractors of USPI

Holding and/or USPI Group or their subsidiaries, regardless of whether Plaintiffs had any

contact with the employees or independent contractors while employed with USP Texas, and

(d) soliciting or conducting business with customers or vendors of USPI Holding and/or

USPI Group or their subsidiaries, regardless of whether Plaintiffs had any contact with the

customers or vendors while employed with USP Texas. Plaintiffs further seek judgment on

their claim of tortious interference with Plaintiffs’ business relationships and expectancy

interests based on Defendants’ improper and intentional attempts to prevent Plaintiffs from

entering into consulting relationships with existing health systems that do not compete with

and have never had relationships with USPI Holding, USPI Group or any of their

subsidiaries, in reliance on the unenforceable Restrictive Covenants. Finally, Plaintiffs seek

an injunction in the form of a temporary restraining order, preliminary injunction and

permanent injunction prohibiting Defendants from enforcing the Restrictive Covenants.

THE PARTIES

2. Upon information and belief, Defendant USPI Group is a Delaware

corporation headquartered in Addison, Texas. Upon further information and belief, USPI

Group is a subsidiary of Defendant USPI Holding.

3. Upon information and belief, USPI Holdings, Inc. is a subsidiary of Defendant

USPI Holding. USPI Holding is a Delaware corporation, but it is headquartered in Texas.

4. Upon further information and belief, United Surgical Partners International

Inc. (“USP International”), which is based in Texas, is a subsidiary of USPI Holdings, Inc.

5. Upon further information and belief, USP International, the operational entity

through which USPI Holding and USPI Group conduct business, has numerous subsidiaries

and owns, manages and/or operates short-stay surgical facilities in several cities across the

United States as well as in the United Kingdom, employing over 11,000 people. Upon

information and belief, USP International also owns, operates, manages and/or partners in

other medical fields, including orthopedics, imaging and urgent care. Upon further

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 2 of 17
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information and belief, USP International operates 266 Ambulatory Surgery Centers

(“ASCs”) and 194 Outpatient centers in twenty-nine states across the country.

6. Plaintiff Aric Burke is a resident of Phoenix, Arizona. From August 2012 to

November 1, 2017, Mr. Burke was employed with USP Texas. Upon information and belief,

USP Texas is a subsidiary of USP International. Mr. Burke began his employment with USP

Texas as a Regional Vice President, but ended his employment as a Market President, which

position he assumed in or about May 2014.

7. Plaintiff Vaughn Ward is an individual who resides in Phoenix, Arizona and,

from July 2014 to November 1, 2017, was employed by USP Texas as a Regional Vice

President.

JURISDICTION AND VENUE

8. This Court has jurisdiction pursuant to 28 U.S.C. § 1332(a)(1) because the

parties are citizens of different states and the amount in controversy is well in excess of the

sum or value of $75,000.

9. Venue is proper in this judicial district pursuant to 28 U.S.C. § 1391 because

(i) Plaintiffs are Arizona residents; (ii) as employees of USP Texas, Defendants performed a

majority of their duties in Arizona, including in Phoenix, Arizona, and executed the

restrictive covenants at issue in Phoenix, Arizona; (iii) Defendants conduct business within

the State of Arizona and this judicial district; (iv) Defendants’ improper conduct is causing

Plaintiffs’ injury in Arizona, and a substantial part of the events or omissions giving rise to

the claims occurred, and continues to occur, in the State of Arizona and in this district.

FACTUAL BACKGROUND

10. During his employment with USP Texas, Mr. Burke’s duties included

responsibility for the overall operations of USP International-owned or operated surgical

facilities in his market territory, referred to as the “West Market.” The West Market

included the states of Arizona, Colorado, Nevada, New Mexico and Wyoming; however,

USP International only owned or managed surgical facilities within the cities of Phoenix,

Tucson, Las Vegas, Denver, Albuquerque and Jackson Hole. Furthermore, Mr. Burke

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 3 of 17
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executed the majority of his duties for facilities in the Phoenix and Tucson areas, where 17

of the total 30 USP International facilities were located within the West territory.

11. Mr. Ward was responsible for the operation of six USP International-owned

or -operated facilities in Phoenix, specifically four ASCs and two surgical hospitals. He

performed all of his work for USP Texas in Maricopa County, Arizona.

12. During their employment with USP Texas, and while residing in Phoenix,

Mr. Burke and Mr. Ward each entered into and signed certain stock option agreements

(“Agreements”). These Agreements contained restrictive covenants (the “Restrictive

Covenants”) with the same or substantially similar limitations, as set forth below:

Covenant not to Compete.

(i) While the [Employee] is employed by the Company [defined as

USPI Group Holdings, Inc. or USPI Holding Company, Inc. depending on the

Agreement] or an Affiliate and for one year from the later of the Termination

Date or the last date on which [Employee] receives a severance payment from

the Company (in the aggregate, the “Non Competition Period”), the

[Employee] shall not, directly or indirectly, whether as owner, partner,

investor, consultant, agent, employee, co-venturer or otherwise (other than

through ownership of publicly traded capital stock of a corporation which

represents less than 1% of the outstanding capital stock of such corporation),

(i) compete with the Company or any subsidiary of the Company in any

business activities, in the United States or in any other country, which the

Company or any subsidiary1of the Company shall conduct or intend to

conduct as of the Termination Date, or (ii) undertake any planning for any

business competitive with the Company or any of its subsidiaries. Specifically,

without limiting the foregoing, the [Employee] agrees not to engage in any

manner in any activity directly or indirectly competitive or potentially

1 The Agreements signed prior to 2015 were entered with USPI Group Holdings, Inc. instead of USPI Holdings

Company, Inc., and referenced “Affiliate” instead of the Company’s subsidiaries in the Restrictive Covenants.

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 4 of 17
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competitive with the business of the Company or any of its subsidiaries as

conducted or competitive with the business of the Company or any of its

subsidiaries as conducted or under consideration at any time during the

[Employee]’s employment with the Company or any of its Affiliates (including

prior to the date hereof).

(ii) [Employee] agrees that, during [Employee]’s employment with

the Company or any of its Affiliates, Burke will not undertake any outside

activity, whether or not competitive with the business of the Company or its

subsidiaries, that could reasonably give risk to a conflict of interest or

otherwise interfere with [Employee]’s duties and obligations to the Company

or any of its subsidiaries.

Non-Solicitation. [Employee] agrees that while [Employee] is

employed by the Company or any of its Affiliates and during the

Non-Competition Period, [Employee] will not, directly or indirectly, (i) hire or

attempt to hire any employee of the Company or any of its subsidiaries or

anyone who was such an employee within the six months preceding such hire

or attempt to hire, (ii) hire or attempt to hire any independent contractor

providing services to the Company or any of its subsidiaries or anyone who

was such an independent contractor within six months preceding such hire or

attempt to hire, (iii) assist in hiring or any attempt to hire anyone identified in

clause (i) or (ii) of this sentence by any other person, (iv) encourage any

employee or independent contractor of the Company or any of its subsidiaries

to terminate his relationship with the Company or any of its subsidiaries, or

(v) solicit or encourage any customer or vendor of the Company or any of its

subsidiaries (including physicians holding clinical privileges at any surgical

facility in which the Company has a direct or indirect ownership interest or

with which a subsidiary has a management agreement) to terminate or diminish

its relationship with any of them, or in the case of a customer, to conduct with

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 5 of 17
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any person any business or activity which such customer conducts or could

conduct with the Company or any of its subsidiaries.

True and correct copies of the stock option agreements, containing the covenants purporting

to bind Mr. Burke and Mr. Ward are attached as Exhibits A, and C.

13. On or about October 10, 2017, Plaintiffs informed USP Texas that they desired

to resign from their employment and to thereafter perform consulting services to surgical

centers owned or operated by existing health systems that do not have, and have never had,

actual or contemplated relationships with USPI Holding, USPI Group or any of their

subsidiaries. In fact, USP International maintains an exclusive relationship with Dignity

Health in Arizona that would preclude USP International from partnering with other health

systems in Arizona.

14. Even though they had no obligation to do so, Plaintiffs offered to continue to

work with USP Texas for a one-month notice period to assist in the transition following their

resignation. Mr. Burke assisted Defendants with locating and recruiting his replacement.

Mr. Burke’s replacement is an existing USPI Market President with over three years of

experience in this role and she has been adequately prepared to perform Mr. Burke’s former

position.

15. Initially, Plaintiffs were told that Defendants would not object to their

proposed venture or their provision of services to health systems in which Defendants have

no interest, as such services were not viewed by Defendants as being competitive.

16. Specifically, on or about October 18, 2017, Mr. Burke raised the Restrictive

Covenants with USPI Chief Operating Officer-West Division, Mark Garvin, to ascertain

Defendants’ intentions with respect to enforcement of the Restrictive Covenants. During

that conversation, Mr. Burke noted that the language of the Restrictive Covenants is very

broad and would essentially prevent Plaintiffs from working for a year anywhere in the

industry. Mr. Garvin quickly acknowledged that the terms of the Restrictive Covenants are

too broad and restrictive “by design.” Mr. Garvin agreed that the Restrictive Covenants, as

written, are “beyond a reasonable scope.”

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 6 of 17
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17. Mr. Garvin stated that, after speaking with others in the company, he would

provide Mr. Burke a letter outlining what actions Defendants would consider permissible,

which Mr. Garvin indicated would be based on a letter Defendants had used for another

former USPI employee, who had left USPI to work for Hospital Corporation of America

“HCA Healthcare,” a direct competitor of Defendants. After leaving USPI, this former

employee worked for HCA in the same market she had worked for USPI in Nashville,

Tennessee.

18. Mr. Burke specifically asked whether Plaintiffs could work in Phoenix with

non-USPI ASCs and health systems and Mr. Garvin agreed that they could do so as long as

Plaintiffs were not competing for Defendants’ clients or physicians. Mr. Garvin then

volunteered that he would not view Plaintiffs’ engagement of business with Banner Health or

HonorHealth as being directly competitive because Defendants work with Dignity Health,

and the other health systems have their own physicians and networks that exclude

Defendants. Mr. Burke asked Mr. Garvin to confirm this and include it in the letter. Mr.

Garvin responded that he would talk with USPI President Brett Brodnax, but that he did not

anticipate there being any concerns. Mr. Garvin indicated that as long as Plaintiffs refrained

from recruiting Defendants’ physicians, Defendants should have no concerns with Plaintiffs

engaging in the venture Plaintiffs proposed.

19. The following day, on October 19, 2017, however, Mr. Garvin sent Mr. Burke

an email stating that Plaintiffs would not be able to work with other health systems or do any

work in Phoenix, Arizona. Mr. Burke asked Defendants to reconsider their position, which

was contrary to what Mr. Garvin had told him the previous day. Mr. Garvin then requested

specific information regarding Plaintiffs’ plans. A true and correct copy of Mr. Garvin’s

October 19, 2017 emails are attached as Exhibit C.

20. That same day, Mr. Burke emailed Mr. Garvin his proposal, which included his

request that Plaintiffs be able to work with ASCs and health systems in markets outside of

USPI markets, and to work with Banner and Banner’s existing ASCs in Phoenix and Tucson.

He emphasized his intent to leave on good terms, but reiterated his request that Defendants

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 7 of 17
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be fair and reasonable in allowing Plaintiffs to earn a living. A true and correct copy of Mr.

Burke’s October 19, 2017 email is attached as Exhibit D.

21. That afternoon, during a phone call with Mr. Burke and Mr. Ward, Mr. Garvin

indicated that Defendants would not permit Plaintiffs to work with Banner or work in the

industry in Phoenix. Mr. Burke recounted his conversation with Mr. Garvin from the prior

day, referencing Mr. Garvin’s assurances that working for Banner or Honor would not be a

problem. Mr. Garvin acknowledged that he had made such statements the prior day, but Mr.

Garvin indicated that Dignity was upset about Plaintiffs working for Banner and wanted

USPI to enforce the Restrictive Covenants.

22. On October 29, 2017, Mr. Garvin sent an email to Plaintiffs with a proposed

attached agreement, which again reiterated Defendants’ insistence that Plaintiffs comply

with their Restrictive Covenants with limited modifications. Among other things,

Defendants reiterated their expectation that Plaintiffs refrain from establishing “any Joint

venture or any other business relationship with Banner Health or any of its affiliates during

the 12-month period following November 10, 2017.” A true and correct copy of Mr.

Garvin’s October 29, 2017 email to Plaintiffs and proposed Agreement is attached as Exhibit

E.

23. At that point, Defendants began to expand the restrictions they were requesting

beyond what they had originally requested. After Plaintiffs again attempted to negotiate

further with Defendants about the unreasonable restrictions Defendants were insisting

Plaintiffs comply with, on October 31, 2017, Mr. Garvin sent an email to Plaintiffs stating “I

can tell you for a fact that there is very little flexibility, if any at all, with what we have

already offered. Remember, we have to protect USPI and all of our partners and uphold our

Agreement.”

24. Defendants provide no services for or at any of the proprietary health care

system facilities to which Plaintiffs desire to provide consulting services. Defendants

therefore have no legitimate interest in enforcing the Restrictive Covenants with respect to

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 8 of 17
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the consulting services Plaintiffs intend to offer. Nonetheless, Defendants have maintained

their refusal to allow Plaintiffs to provide the consulting services as specified.

25. Plaintiffs have expressed to Defendants their belief that the Restrictive

Covenants are unenforceable and that they consequently have the legal right to engage in the

contemplated activities without Defendants’ approval. Defendants have expressed their

disagreement and continue to maintain that any consulting work by Plaintiffs for existing

health systems would violate the Restrictive Covenants.

26. As outlined above, an immediate case or controversy exists between Plaintiffs

and Defendants with respect to whether the Restrictive Covenants are valid and enforceable.

27. Plaintiffs’ inability to begin providing consulting services to the relevant health

systems will cause substantial, immediate, and irreparable harm to Plaintiffs’ current and

prospective business relationships with such health systems. Because the nature and value of

the goodwill that would be damaged and the future contracts and opportunities with these

health systems that otherwise would exist are impossible to determine with certainty, the

harm Plaintiffs will suffer as a result of Defendants’ wrongful conduct cannot be remedied

by damages alone.

28. Furthermore, if the Restrictive Covenants were enforced as drafted, Plaintiffs

would be prohibited from competing (or even planning to compete) anywhere in the world,

even in countries, states, and cities where Defendants have no existing locations.

Enforcement of the Restrictive Covenants would also preclude Plaintiffs from working in or

around Phoenix, even if such work does not compete with USP Holding, USPI Group or

their subsidiaries. As a result, Plaintiffs would certainly be required to seek employment

elsewhere in a completely different industry, with significant, incalculable and damaging

financial ramifications, and possibly forcing Plaintiffs to move away from Phoenix. Thus,

Defendants’ attempt to enforce invalid and unenforceable restrictions and to keep Plaintiffs

from competing in the United States or anywhere USP Holding, USPI Group or their

subsidiaries conduct or intend to conduct any kind of business, including business beyond

that in which Plaintiffs provided services for USP Texas, will substantially harm Plaintiffs.

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 9 of 17
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COUNT ONE

(Declaratory Judgment that the Restrictive Covenants are Unenforceable)

29. Plaintiffs incorporate by reference paragraphs 1 through 28 above as if fully set

forth herein.

30. This is a claim for declaratory relief brought against USPI pursuant to the

provisions 28 U.S.C. § 2201, which empowers this Court to declare the rights and legal

relations of the parties. These provisions are to be liberally construed and administered.

31. An actual case or controversy exists concerning Plaintiffs’ Restrictive

Covenants, which cannot be cured without the intervention of this Court.

32. Section (a) of the Restrictive Covenants seeks to prevent Plaintiffs from

competing, or “undertak[ing] any planning” to compete, anywhere in the world with USPI

Holding and/or USPI Group or any of their subsidiaries.

33. These restrictions are overly broad with respect to scope and territory, which,

as drafted, extends to “the United States or in any other country[.]” Such a broad restriction

is not reasonable or necessary to protect any legitimate interest Defendants may have in

precluding competition by Plaintiffs, because Plaintiffs did not service the entire United

States, much less the entire world, while employed by USP Texas. Moreover, Defendants do

not transact business or maintain locations in every city, state or country, and thus a

worldwide restriction is overly broad and unreasonable.

34. The Restrictive Covenants also are overly broad to the extent they purport to

restrict Plaintiffs in every actual or contemplated business activity of USPI Holding, USPI

Group and their subsidiaries, despite the fact that Plaintiffs have never worked with or

gained knowledge about any lines of business or services of any entity except USP Texas,

nor have they developed goodwill with customers of any entity other than USP Texas in very

limited areas, nor have Plaintiffs provided services while employed by USP Texas outside

the surgical services industry.

35. The restrictions also impermissibly attempt to prohibit Plaintiffs from so much

as “planning” to compete with USPI Holding, USPI Group or any of their subsidiaries. This

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 10 of 17
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restriction is unenforceable because it is vague and ambiguous, overly broad on its face, and

has the effect of unfairly extending the term of the covenant beyond a reasonable temporal

limit and geography. Moreover, Defendants do not have a legitimate protectable interest in

precluding Plaintiffs from planning or preparing to compete, as such activities are lawful.

36. Section (b) of the Restrictive Covenants seeks to prevent Plaintiffs from hiring

or attempting to hire any employee or independent contractor of USPI Holding, USPI Group

or any of their subsidiaries if the individual was an employee within the last six months prior

to the hire, or to encourage any such employee or independent contractor to terminate his or

her relationship with USPI Holding, USPI Group or their subsidiaries. Section (b) also seeks

to prohibit Plaintiffs from soliciting any customer or vendor of USPI Holding, USPI Group

or their subsidiaries to terminate their relationships, and to prohibit Plaintiffs from

conducting any business with any customer of USPI Holding, USPI Group or any of their

subsidiaries, if such business is competitive with USPI Holdings, USPI Group or any of their

subsidiaries.

37. The employee/independent contractor non-solicitation agreement is

unenforceable and overly broad, because Defendants have no legitimate interest in

preventing employees or independent contractors from leaving their workforce, which is

ordinary competition, and because such restrictions are anticompetitive and impose an undue

burden on employees, contractors, and vendors who have not signed restrictive covenants.

Furthermore, Plaintiffs have had no contact and developed no goodwill with the vast

majority of individuals employed by or who have contracted with USPI Holding, USPI

Group or their subsidiaries, and USPI Holding, USPI Group or their subsidiaries therefore

have no legitimate interest in preventing Plaintiffs from hiring or soliciting such employees.

In addition, the restriction applies to employees and independent contractors who may no

longer have any ongoing relationship with USPI Holding, USPI Group or their subsidiaries;

therefore, it is overbroad and unenforceable. Finally, the restriction prevents Plaintiffs from

hiring any employees or contractors, regardless of whether Plaintiffs actually recruit or

solicit the employees or contractors, which is also overly broad and unenforceable.

Case 2:17-cv-04032-JJT Document 1 Filed 11/01/17 Page 11 of 17
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38. The customer non-solicitation provision is also overly broad, because it

prevents Plaintiffs from soliciting or providing services to any customers of USPI Holding,

USPI Group or their subsidiaries, and it is not limited to only those customers with whom

Plaintiffs have worked or developed goodwill, or about whom Plaintiffs had confidential

information. Defendants have no legitimate interest in preventing Plaintiffs from working

with customers who were are unknown to Plaintiffs and/or who are customers of USPI

Holding, USPI Group or their subsidiaries, especially those who are customers in lines of

business beyond the industry in which Plaintiffs were employed.

39. In addition to the fact that the Restrictive Covenants are overbroad on their

face, it is significant that Plaintiffs have specifically informed Defendants of their desire to

provide consulting services only to those health system networks with which Defendants

have no relationship. Defendants have no contract, prospective contract or reasonable

expectancy of providing any services to the patients or facilities within such networks. As a

result, Defendants have no legitimate business interest to protect and thus no legal

justification for enforcing the Restrictive Covenants to prevent Plaintiffs from providing

consulting services as desired by Plaintiffs.

40. Finally, while the Agreement contains a Delaware choice of law provision, that

choice of law provision is unenforceable because, among other things, Delaware has no

substantial relationship to the parties or the transactions at issue, there is no other reasonable

basis for the application of Delaware law, and application of Delaware law would be

contrary to a fundamental policy of Arizona, which has a materially greater interest than

Delaware in the determination of the dispute.

41. Plaintiffs, therefore, are entitled to a declaratory judgment that the Restrictive

Covenants are invalid and unenforceable under Arizona law.

COUNT TWO

(Tortious Interference With Business Expectancy)

42. Plaintiffs incorporate by reference paragraphs 1 through 41 above as if fully set

forth herein.

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43. Plaintiffs desire to provide consulting services to certain health systems, which

will not require Plaintiffs to engage in any unfair competition as to clients served or goodwill

developed while Plaintiffs were employed at USP Texas. Defendants are aware of Plaintiffs’

expectancy interests with such health systems.

44. With actual knowledge of Plaintiffs’ relationship and business expectancy with

the relevant health systems, Defendants have interfered with this relationship and expectancy

by, among other things, asserting that Plaintiffs are precluded from providing consulting

services in the limited and fair manner outlined above, due to the Restrictive Covenants,

which are unenforceable.

45. Defendants’ intentional interference with Plaintiffs’ business relationship and

expectancy interest is neither proper nor privileged, because Defendants have no legitimate

interest in preventing Plaintiffs from providing consulting services with respect to those

health systems with which Defendants have no relationship or goodwill and to whom

Defendants have no expectation of providing services.

46. Defendants’ actions are intended to interfere with, and have in fact interfered

with and disrupted, Plaintiffs’ business relationships and expectancies with the relevant

health systems.

47. As a direct, proximate, and legal result of Defendants’ conduct, Plaintiffs have

suffered and will continue to suffer immediate irreparable harm.

COUNT THREE

(Injunction Prohibiting Enforcement of the Restrictive Covenants)

48. Plaintiffs incorporate by reference paragraphs 1 through 47 above as if fully set

forth herein.

49. Because the Restrictive Covenants are overly broad and unenforceable for

multiple reasons, and because Defendants have no legitimate business interest to protect, and

thus no legal justification for enforcing the Restrictive Covenants as drafted, Plaintiffs are

likely to succeed on the merits in their request for a declaration that the Restrictive

Covenants are unenforceable and on their tortious interference claim.

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50. If an injunction in the form of a temporary restraining order, preliminary

injunction, and permanent injunction does not issue, Plaintiffs will be unable to expeditiously

provide consulting services to certain health systems, as they have agreed to do. This

inability to provide services will cause immediate and irreparable harm to Plaintiffs’

goodwill with those health systems and Plaintiffs’ actual and expected continuation of their

business relationship with those health systems.

51. Defendants do not have and have never had any contract, prospective contract

or expectancy in working with or providing services to existing health systems that have no

current relationship with Defendants, and which Defendants are precluded from contracting

or servicing due to their exclusive relationship with Dignity Health. As a result, an

injunction in the form of a temporary restraining order, preliminary injunction, and

permanent injunction prohibiting enforcement of the Restrictive Covenants, and immediately

allowing Plaintiffs to enter into contracts with the health systems, will cause no damage to

Defendants and will not harm Defendants in any other meaningful way.

52. If an injunction does not issue and Plaintiffs are prevented from providing

consulting services to the relevant health systems pursuant to the overly broad terms of the

Restrictive Covenants, Plaintiffs would be forced to relocate outside of Phoenix in order to

obtain employment and/or to abandon the industry in which they have historically earned

their living. Furthermore, Plaintiffs may be entirely unable to work in their chosen

profession if they are unable to work anywhere in the United States and/or where USPI

Holding, UPSI Group or any of their subsidiaries conduct business or even plan to conduct

business. This result would cause significant and irreparable harm to Plaintiffs, who cannot

be entirely precluded from earning a living in their chosen field, especially when Defendants

have no legitimate interest in preventing Plaintiffs from engaging in the proposed work.

53. The foregoing factors favor Plaintiffs and entry of an injunction in the form of

a temporary restraining order, preliminary injunction, and/or permanent injunction; therefore,

Defendants should be enjoined from seeking to enforce the Restrictive Covenants.

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54. Plaintiffs’ request for injunctive relief should be granted without any

requirement to post a bond in light of the fact that Defendants do not have and have never

had any contract, relationship or expectancy with the relevant health systems, and therefore

will suffer no harm upon entry of an injunction. To the extent the Court determines a bond is

necessary, only a nominal bond should be required.

RELIEF REQUESTED

WHEREFORE, Plaintiffs respectfully request judgment against Defendants as

follows:

1. A declaratory judgment that the Restrictive Covenants are unenforceable;

2. A temporary restraining order, preliminary and permanent injunction

prohibiting Defendants from seeking to enforce the Restrictive Covenants;

3. For general, incidental, and consequential damages against Defendants in an

amount to be proven at trial;

4. For attorneys’ fees pursuant to A.R.S. § 12-341.01(A) and costs incurred; and

5. For such other relief as the Court deems appropriate.

DATED this 1st day of November, 2017.

LEWIS ROCA ROTHGERBER CHRISTIE LLP

BY: /s/ Mary Ellen Simonson

Mary Ellen Simonson

Bruce E. Samuels

Laura Pasqualone

Attorneys for Plaintiffs

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