Court Opinion

ID: 4148236
Source: CourtListenerOpinion
Date Created: 2017-02-24 17:07:40.594144+00
Date Added: 2024-06-11T14:19:55.269123
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                               FILED
regarded as precedent or cited before any                      Feb 24 2017, 8:20 am
court except for the purpose of establishing
                                                                    CLERK
the defense of res judicata, collateral                         Indiana Supreme Court
                                                                   Court of Appeals
estoppel, or the law of the case.                                    and Tax Court

ATTORNEYS FOR APPELLANT                                  ATTORNEYS FOR APPELLEES
Kristen E. Prinz                                         Robert A. Anderson
Chicago, Illinois                                        Shannon L. Noder
                                                         Merrillville, Indiana
Bryan Bullock
Merrillville, Indiana                                    Libby Yin Goodknight
                                                         Indianapolis, Indiana

                                                         Jacqueline Sells Homann
                                                         South Bend, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Sheila Manhas, M.D.,                                     February 24, 2017
Appellant-Plaintiff,                                     Court of Appeals Case No.
                                                         45A05-1602-CT-328
        v.                                               Appeal from the Lake Superior
                                                         Court
Franciscan Hammond Clinic,                               The Honorable John Sedia, Judge
LLC, Hammond Clinic, LLC,                                Trial Court Cause No.
and Deepak Majmudar, M.D.,                               45D01-1311-CT-216
Individually,
Appellees-Defendants.

Altice, Judge.

Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 1 of 15
                                                Case Summary

[1]   Sheila Manhas, M.D., (Dr. Manhas) appeals from the trial court’s grant of

      summary judgment in favor of Franciscan Hammond Clinic, LLC (FHC),

      Hammond Clinic, and Deepak Majmudar, M.D., individually (Dr. Majmudar),

      (collectively, the Defendants) on her complaint for defamation per se,

      defamation per quod, and for violation of Ind. Code § 22-5-3-2, a.k.a. Indiana’s

      blacklisting statute. Dr. Manhas presents several issues for our review, which

      we consolidate and restate as: did the trial court properly grant summary

      judgment in favor of the Defendants?

[2]   We reverse and remand.

                                       Facts & Procedural History

[3]   On July 28, 2008, Dr. Manhas entered into a two-year employment agreement

      with Hammond Clinic to work as a full-time, licensed neurologist. On June 11,

      2010, Dr. Cynthia Sanders, the Medical Director and Managing Partner of

      Hammond Clinic and Dr. Manhas’s supervisor, notified Dr. Manhas that she

      was being terminated for cause due to her failure to obtain unrestricted hospital

      privileges at Community Hospital. Ultimately, however, Hammond Clinic

      decided not to terminate Dr. Manhas’s employment, but instead chose to

      employ Dr. Manhas through the expiration of her employment agreement,

      which was set to expire by its own terms on July 27, 2010. According to Dr.

      Manhas, her employment agreement with Hammond Clinic was not extended

      because she had informed Hammond Clinic that she was pregnant. On

      Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 2 of 15
      September 9, 2010, Dr. Manhas filed a sex discrimination claim against

      Hammond Clinic with the Equal Employment Opportunity Commission.

[4]   While Dr. Manhas’s discrimination claim was still pending against Hammond

      Clinic, Franciscan Alliance, Inc. acquired substantially all of the assets of

      Hammond Clinic and transferred those assets to FHC on or about June 1, 2011.

      Thereafter, on September 25, 2011, Dr. Manhas and Hammond Clinic settled

      the discrimination claim and both parties signed a Confidential Severance

      Agreement, General Release, and Waiver (Settlement Agreement). Section 4 of

      the Settlement Agreement provided:

              Dr. Manhas will direct inquiries from prospective employers to
              Karen Weyer, Director of Human Resources, [FHC], . . . who
              will provide only the following information: dates of
              employment, last position held, and salary.

      Appellant’s Appendix Volume 3 at 71.

[5]   Dr. Manhas claims that during the summer of 2013, she was offered a

      temporary position as a neurologist at Tripler Army Medical Center (Tripler) in

      Honolulu, Hawaii. Tripler had hired Platinum Business Corporation

      (Platinum), a temporary physician placement agency, to complete the

      credentialing process, which included verification of Dr. Manhas’s previous

      employment. Before compiling the required information, Platinum required

      Dr. Manhas to sign a Release of Information/Consent to Background Check

      (Authorization Form). The opening paragraph of this form explained:

      Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 3 of 15
        A report is being obtained for the purpose of evaluating you for
        employment. This report may include among other items,
        criminal background information, confirmation of your
        educational and employment history, work performance and
        confirmation of references provided.

Id. at 86. By signing the Authorization Form, Dr. Manhas

        authorize[d] [Platinum] . . . and or its agents to perform a check
        of [her] background, references, character, employment, motor
        vehicle, education and criminal history record bearing on
        information which may be in any state or local files, including
        those maintained by both public and private organizations and
        all public records for the purpose of confirming the information
        contained in the application and/or obtaining other information
        which may be material to [her] qualifications for employment.

Id. She further “consent[ed] to the release of such information by said

individuals and organizations to [Platinum] and authoriz[ed] [Platinum] to

consider such information when making decisions regarding [her]

employment.” Id. The form also included the following provision (hereinafter

referred to as “the Release”):

        I hereby release [Platinum], its corporate affiliates, its current
        and/or former officers, directors and employees, its authorized
        agents and representatives and all others involved in this background
        investigation and any subsequent investigations, from any liability
        in connection with any information they give or gather and any
        decisions made concerning my employment based on such
        information.

Id. (emphasis supplied).

Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 4 of 15
[6]   Gay Lynn Heaney (Ms. Heaney), a credentialing coordinator for Platinum, was

      in charge of compiling information from Dr. Manhas’s previous employers,

      including Hammond Clinic. Ms. Heaney sent three separate forms to

      Hammond Clinic, “Attention: Barb”.1 Id. at 81. Two of the forms sought an

      evaluation of Dr. Manhas as a physician and the third document was the

      Authorization Form signed by Dr. Manhas. One of the evaluation forms

      (hereinafter referred to as “the Evaluation Form”) requested the evaluator to

      provide an opinion of Dr. Manhas by marking in the appropriate column for

      “Good”, “Fair”, or “Poor” in the following areas: technical skills, attitude

      towards supervision, attitude towards duties, attendance record, and overall

      employment performance. Id.

[7]   The Evaluation Form was given to Dr. Sanders, but she refused to complete it

      because she did not believe her position with FHC authorized her to do so.

      Eventually, Dr. Deepak Majmudar completed the Evaluation Form on behalf

      of Hammond Clinic and returned it to Ms. Heaney. Even though Dr.

      Majmudar had never worked with Dr. Manhas and did not recall ever meeting

      her, he assessed Dr. Manhas’s skills as either “Fair” or “Poor” and further

      indicated that she was not eligible for rehire, writing “see above” as a reference

      to the “Fair” and “Poor” ratings. Id. Dr. Majmudar also stated that Dr.

      Manhas had been “terminated.” Id. Dr. Majmudar was not aware of the

      1
       Barbara Belligio was the credentialing specialist at FHC and had worked in that capacity during Dr.
      Manhas’s tenure with Hammond Clinic.

      Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017         Page 5 of 15
      Settlement Agreement from the discrimination action. Ms. Heaney forwarded

      the information provided by Dr. Majmudar to Tripler. Based in part on the

      poor evaluation, Tripler ultimately decided not to hire Dr. Manhas.

[8]   Dr. Manhas retained an attorney, who, on Dr. Manhas’s behalf, corresponded

      with Dr. Majmudar regarding his responses on the Evaluation Form. Dr.

      Majmudar reviewed Dr. Manhas’s credentialing file and confirmed that he

      made false and inaccurate statements about Dr. Manhas. Specifically, there

      was nothing in Dr. Manhas’s file that indicated she was not eligible for rehire.

      Dr. Majmudar then wrote two letters, one to Dr. Manhas’s attorney and one to

      Ms. Heaney. In the letters, Dr. Majmudar apologized for the inaccuracies in

      his evaluation of Dr. Manhas, noting that Dr. Manhas left Hammond Clinic in

      good standing and that he would recommend her without reservation. He

      further admitted that he “was wrong to make those statements” and that he

      “completely and whole heartedly regret[ted] and retract[ed] [his] statements on

      the reference evaluation to Platinum [].” Id. at 133. Dr. Majmudar further

      noted that contrary to his responses, Dr. Manhas received positive feedback

      regarding her performance at Hammond Clinic.

[9]   On November 4, 2013, Dr. Manhas filed her initial complaint for defamation

      per se, defamation per quod, and for violation of Indiana’s blacklisting statute,

      I.C. § 22-5-3-2, naming Hammond Clinic, Dr. Majmudar, and FHC as

      defendants. She filed an amended complaint on January 16, 2015. On January

      28, 2015, Hammond Clinic filed its amended answer as well as a counterclaim

      alleging that Dr. Manhas breached the terms of the Settlement Agreement that

      Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 6 of 15
       arose from the discrimination claim. On February 23, 2015, FHC and Dr.

       Majmudar filed their answer and a similar counterclaim. Hammond Clinic

       subsequently withdrew its counterclaim, but FHC’s counterclaim remains

       pending before the trial court.

[10]   On July 6, 2015, FHC and Dr. Majmudar filed a motion for summary

       judgment, arguing that the Release contained in the Authorization Form

       relieved them of any and all liability arising out of the responses provided in the

       Evaluation Form. Hammond Clinic filed a motion to join in FHC and Dr.

       Majmudar’s summary judgment motion, which was granted by the trial court

       on December 8, 2015. The trial court held a summary judgment hearing on

       January 5, 2016. Three days later the trial court entered its order granting

       summary judgment in favor of the Defendants. The trial court concluded that

       the language of the Release was “explicit and unambiguous” that Dr. Manhas

       was releasing designated parties from all liability. Appellant’s Appendix Volume 2

       at 32. The court implicitly determined that the catch-all phrase in the Release –

       “all others involved in this background investigation” – encompassed the

       Defendants and thus, the Defendants were released from any liability arising

       out of information provided on the Evaluation Form. Appellant’s Appendix

       Volume 3 at 86. The trial court therefore granted summary judgment in favor of

       the Defendants.

[11]   On January 19, 2016, the trial court determined that there was no just reason

       for delay and directed entry of final judgment for Hammond Clinic. A similar

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 7 of 15
       order was entered for FHC and Dr. Majmudar on February 1, 2016. Dr.

       Manhas now appeals. Additional facts will be provided as necessary.

                                           Discussion & Decision

[12]   We review summary judgment de novo, applying the same standard as the trial

       court: “Drawing all reasonable inferences in favor of ... the non-moving parties,

       summary judgment is appropriate ‘if the designated evidentiary matter shows

       that there is no genuine issue as to any material fact and that the moving party

       is entitled to judgment as a matter of law.’” Williams v. Tharp, 914 N.E.2d 756,

       761 (Ind. 2009) (quoting Ind. Trial Rule 56(C)). “A fact is ‘material’ if its

       resolution would affect the outcome of the case, and an issue is ‘genuine’ if a

       trier of fact is required to resolve the parties’ differing accounts of the truth, or if

       the undisputed material facts support conflicting reasonable inferences.” Id.

       (internal citations omitted).

[13]   The initial burden is on the party moving for summary judgment to

       “demonstrate ... the absence of any genuine issue of fact as to a determinative

       issue,” at which point the burden shifts to the non-movant to “come forward

       with contrary evidence” showing an issue for the trier of fact. Id. at 761-62

       (internal quotation marks and substitution omitted). And “[a]lthough the non-

       moving party has the burden on appeal of persuading us that the grant of

       summary judgment was erroneous, we carefully assess the trial court’s decision

       to ensure that [s]he was not improperly denied h[er] day in court.” McSwane v.

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 8 of 15
       Bloomington Hosp. & Healthcare Sys., 916 N.E.2d 906, 909-10 (Ind. 2009)

       (internal quotation marks omitted).

[14]   The sole issue before us is whether the Release signed by Dr. Manhas applies to

       the Defendants. A release, as with any contract, should be interpreted

       according to the standard rules of contract law with the parties’ intentions

       regarding the purpose of the document governing. Stemm v. Estate of Dunlap,

       717 N.E.2d 971, 975 (Ind. Ct. App. 1999) (citing Huffman v. Monroe Cty. Cmty.

       Sch. Corp., 588 N.E.2d 1264, 1266-67) (Ind. 1992)). The interpretation of the

       language of a release presents a question of law and is therefore appropriate for

       summary judgment proceedings. See TW Gen. Contracting Servs., Inc. v. First

       Farmers Bank & Trust, 904 N.E.2d 1285, 1287-88 (Ind. Ct. App. 2009).

               When construing the meaning of a contract, our primary task is
               to determine and effectuate the intent of the parties. First, we
               must determine whether the language of the contract is
               ambiguous. The unambiguous language of a contract is
               conclusive upon the parties to the contract and upon the courts.
               If the language of the instrument is unambiguous, the parties’
               intent will be determined from the four corners of the contract.
               If, on the other hand, a contract is ambiguous, its meaning must
               be determined by examining extrinsic evidence and its
               construction is a matter for the fact-finder. When interpreting a
               written contract, we attempt to determine the intent of the parties
               at the time the contract was made. We do this by examining the
               language used in the instrument to express their rights and duties.
               We read the contract as a whole and will attempt to construe the
               contractual language so as not to render any words, phrases, or
               terms ineffective or meaningless.

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 9 of 15
       T-3 Martinsville, LLC v. U.S. Holding, LLC, 911 N.E.2d 100, 111 (Ind. Ct. App.

       2009), clarified on reh’g, 916 N.E.2d 205, trans. denied (citation omitted).

[15]   Here, we note that the Defendants were not parties to the Authorization Form.

       They seek the protection afforded by the Release as third-party beneficiaries.

       Generally, only parties to a contract or those in privity with the parties have

       rights under the contract. OEC-Diasonics, Inc. v. Major, 674 N.E.2d 1312, 1314-

       1315 (Ind. 1996). However,

               [o]ne not a party to an agreement may nonetheless enforce it by
               demonstrating that the parties intended to protect him under the
               agreement by the imposition of a duty in his favor. To be
               enforceable, it must clearly appear that it was the purpose or a
               purpose of the contract to impose an obligation on one of the
               contracting parties in favor of the third party. It is not enough
               that performance of the contract would be of benefit to the third
               party. It must appear that it was the intention of one of the
               parties to require performance of some part of it in favor of such
               third party and for his benefit, and that the other party to the
               agreement intended to assume the obligation thus imposed.

       Id. at 1315 (internal citation omitted). The intent of the contracting parties to

       bestow rights upon a third party must affirmatively appear from the language of

       the instrument when properly interpreted and construed. Id. However, it is not

       necessary that the intent to benefit a third party be demonstrated any more

       clearly than the parties’ intent regarding any other terms of the contract. Id.

[16]   Dr. Manhas argues that when reading the Authorization Form as a whole, it is

       clear that Platinum “drafted a broad document to protect itself from liability,

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 10 of 15
       and that the words ‘all others involved’ [in the Release] are used as a catch-all

       phrase to protect [Platinum],” not former employers. Appellant’s Brief at 17.

       She points out that the Authorization Form defined Platinum as the

       “Employer” and thereafter limited liability for Platinum’s “current and/or

       former officers, directors and employees, its authorized agents and

       representatives and all others involved in this background investigation.”

       Appellant’s Appendix Volume 3 at 86. Because there is no comma separating “all

       others involved,” Dr. Manhas maintains that such phrase is prefaced by the

       phrase “[Platinum’s] authorized agents and representatives.” Id. In other

       words, Dr. Manhas argues that the language used clearly evinces an intent that

       the Release does not extend to the Defendants. At the very least, Dr. Manhas

       argues that there is an ambiguity with regard to who falls within the scope of

       the Release such that summary judgment was improper.

[17]   Although finding that the language of the Release was “explicit and

       unambiguous,” the trial court did not interpret such provision the same as Dr.

       Manhas. Appellant’s Appendix Volume 2 at 32. Rather, the trial court sided with

       the Defendants and concluded that the language of the Release clearly provided

       that the Defendants were released of all liability for the responses provided on

       the Evaluation Form, regardless of the accuracy thereof. In so concluding, the

       trial court found “particularly instructive” this court’s decision in Eitler v. St.

       Joseph Reg’l Med. Ctr. South-Bend Campus, Inc., 789 N.E.2d 497 (Ind. Ct. App.

       2003), trans. denied. Appellant’s Appendix Volume 2 at 31.

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 11 of 15
[18]   In Eitler, a nurse sought employment with a new healthcare agency. As part of

       her application, she was required to sign and then send to her former employer

       a Confidential Reference Check Report that requested an evaluation of the

       nurse as “above average,” “average,” or “below average” in a number of

       different categories and indication of whether the nurse would be rehired. The

       form contained an authorization/release indicating that the nurse “authorize[d]

       the addressed individual [her former supervisor] . . . to furnish an employment

       reference (verification/evaluation) to [prospective employer]” and that she

       “release[d] both parties from any and all liability for damages in the furnishing

       and receiving of this information.” Eitler, 789 N.E.2d at 499 (emphasis

       supplied). After the nurse received a negative review, she filed suit against her

       former employer and supervisor claiming defamation and a violation of the

       blacklisting statute. This court affirmed the trial court’s grant of summary

       judgment in favor of the former employer and supervisor, concluding that the

       nurse’s claims were barred by the “explicit and unambiguous” language of the

       release. Id. at 501.

[19]   Dr. Manhas asserts that the trial court’s reliance on Eitler is misplaced in that

       Eitler is wholly distinguishable from this case. We agree. In Eitler, the release

       provision specifically identified and named the former employer and the

       prospective employer and expressly released “both parties” – a clear reference

       to those named—from any liability arising out of information exchanged

       between the named parties. Here, on the other hand, the Release provision

       does not explicitly identify any of the Defendants. Indeed, the Authorization

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 12 of 15
       Form identifies only Dr. Manhas and Platinum and the Release explicitly

       applies to Platinum’s “corporate affiliates, its current and/or former officers,

       directors and employees, its authorized agents and representatives and all others

       involved in this background investigation.” Appellant’s Appendix Volume 3 at 86

       (emphasis supplied).

[20]   We now turn to interpretation of the Release at issue in this case. “To get at the

       thought or meaning expressed in a statute, a contract, or a constitution, the first

       resort, in all cases, is to the natural signification of the words, in the order of

       grammatical arrangement in which the framers of the instrument have placed

       them.” Lake Cnty. v. Rollins, 130 U.S. 662, 670, 9 S. Ct. 651, 32 L. Ed. 1060

       (1889). See also, Hamilton Cnty. Dep’t of Pub. Welfare v. Smith, 567 N.E.2d 165,

       169 (Ind. Ct. App. 1991) (“In addition, where the meaning of a particular

       clause or phrase is in doubt, the court should examine the grammatical

       structure of the clause in order to ascertain its meaning.”). FLM, LLC v.

       Cincinnati Ins. Co., 973 N.E.2d 1167, 1176 (Ind. Ct. App. 2012). “As a matter of

       strict grammatical construction, the descriptive words in a phrase should, in the

       absence of punctuation, be referred to their nearest antecedent . . . .” First Nat’l

       Bank of Peoria v. Farmers’ & Merchants’ Nat’l Bank of Wabash, 171 Ind. 323, 86
N.E. 417, 423 (1908).

[21]   Here, the “all others involved” language is not separated by commas and is

       prefaced by “authorized agents and representatives” of Platinum. Giving full

       effect to its grammatical structure, the catch-all phrase refers to “all others

       involved” with Platinum’s authorized agents and representatives. Further,

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017   Page 13 of 15
       there is no language in the Authorization Form or the Release from which we

       can decipher any intent to extend the protection of the Release to third parties,

       i.e., former employers. A plain reading of the Authorization Form as well as

       the Release contained therein reveals that Platinum cast a wide net to relieve

       itself of any liability and clearly evinces an intent that the Release does not

       extend to the Defendants.

[22]   FHC and Dr. Majmudar’s2 argument to the contrary is disingenuous, if not

       misleading. In arguing that the Release extends to them through its use of the

       phrase “all others involved,” FHC and Dr. Majmudar misrepresent the

       evidence in the record. Specifically, FHC and Dr. Majmudar assert that

       “[p]ursuant to the Release, Dr. Manhas ‘released [Platinum], its corporate

       affiliates, its current and/or former officers, directors and employees, its

       authorized agents and representatives[.]’” Brief of FHC and Dr. Majmudar at 30

       (emphasis and alterations in original). They then continue, stating that “Dr.

       Manhas also ‘released . . . all others involved in this background

       investigation[.]” Id. (emphasis and alterations in original). As set forth above,

       these two parts of the Release are not separate and independent clauses as

       suggested by FHC and Dr. Majmudar.

[23]   As we noted, the phrase “all others involved in this background investigation”

       is not set off by commas and is prefaced by reference to Platinum’s “authorized

       2
        FHC and Dr. Majmudar filed a joint brief. Hammond Clinic filed a separate brief, albeit incorporating
       many of FHC and Dr. Majmudar’s arguments.

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017      Page 14 of 15
       agents and representatives.” When read in context, it becomes evident that the

       general, catch-all phrase “all others involved” is directed at Platinum, not

       former employers as third-party beneficiaries. In sum, we find the language of

       the Release to be unambiguous. We, however, interpret the language

       differently than that urged by the Defendants.

[24]   Having found the Authorization Form, and more specifically, the language of

       the Release, to be unambiguous, we need only look within the four corners of

       the document. The intent as expressed therein is clear—the Defendants, i.e.,

       third-party beneficiaries, do not fall within the scope of the Release. 3 Summary

       judgment in favor of the Defendants is reversed, and this case is remanded to

       the trial court for further proceedings.

[25]   Judgment reversed and remanded.

[26]   Riley, J. and Crone, J., concur.

       3
         With regard to public policy considerations discussed by the parties, we agree that free flow of information
       is critical. Equally as critical, however, is that the information be accurate.

       Court of Appeals of Indiana | Memorandum Decision 45A05-1602-CT-328 | February 24, 2017           Page 15 of 15