Court Opinion

ID: 2974979
Source: CourtListenerOpinion
Date Created: 2015-09-22 17:26:51.48724+00
Date Added: 2024-06-11T15:02:22.764489
License: Public Domain

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                            File Name: 07a0159n.06
                            Filed: February 27, 2007

                                      Nos. 04-6485 and 05-5041

                            UNITED STATES COURT OF APPEALS
                                 FOR THE SIXTH CIRCUIT

CAMBIO HEALTH SOLUTIONS, LLC,                       )
                                                    )
        Plaintiff,                                  )
                                                    )
v.                                                  )    ON APPEAL FROM THE UNITED
                                                    )    STATES DISTRICT COURT FOR THE
THOMAS M. REARDON,                                  )    MIDDLE DISTRICT OF TENNESSEE
                                                    )
        Defendant-Appellee                          )
        Cross-Appellant,                            )
                                                    )
CAMBIO HEALTH SOLUTIONS, L.L.C.;                    )
TRIAD HOSPITALS, INC.; QUORUM                       )
HEALTH RESOURCES, L.L.C.; and                       )
INTENSIVE RESOURCE GROUP, L.L.C.,                   )
                                                    )
        Defendants-Appellants                       )
        Cross-Appellees.                            )

Before: DAUGHTREY and SUTTON, Circuit Judges.*

        SUTTON, Circuit Judge. Does a parent company holding a majority, but less than a 100%,

interest in its subsidiary enjoy a qualified privilege to interfere with the contractual relations of that

subsidiary?    After determining that this question of state law remained an open one in

Tennessee—and one upon which much of the $5.9 million jury verdict in this case turned—we

        *
         The Honorable David A. Nelson participated in the oral argument in this case but did not
participate in this decision due to his retirement effective July 31, 2006.
Nos. 04-6485 and 05-5041
Cambio Health v. Reardon, et al.

certified the question to the Tennessee Supreme Court. Having now learned from our sister court

that a company with less than a 100% interest in a subsidiary does not have a qualified privilege to

interfere with the contractual relations of the subsidiary under Tennessee law, we affirm the jury’s

verdict for Thomas M. Reardon on his claims against Triad Hospitals, Inc., Quorum Health

Resources and the Intensive Resource Group for tortious interference with contract and procurement

of a breach of contract. We thus reject this and several other challenges to the jury verdict, and we

now affirm.

                                                 I.

       On September 1, 1999, Thomas M. Reardon began working as the CEO for Cambio Health

Solutions, LLC (Cambio), which provides consulting services to healthcare providers. Under the

terms of his executive consulting agreement with Cambio, Reardon could terminate his employment

with the company for “good reason” following a “change in control” at Cambio or Intensive

Resource Group, LLC (IRG). IRG had an 80% interest in Cambio; Reardon obtained a 10% interest

in the company as part of his compensation; and private investors held the remaining 10% interest

in Cambio.

       Making matters more complicated, IRG was a wholly owned subsidiary of Quorum Health

Resources (QHR), which itself was wholly owned by Quorum Health Group (QHG). In April 2001,

Triad Hospitals, Inc. acquired and absorbed QHG through a merger. That October, Dan Moen

became an officer of Triad and CEO of QHR.

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       Convinced that the April 2001 merger had effectively stripped him of his responsibilities,

particularly when considered in conjunction with actions taken by Moen and others after the merger,

Reardon notified Cambio in a letter dated March 14, 2002, that he was terminating his employment

with the company. The “change in control” stemming from the April 2001 merger, he explained,

amounted to a “good reason” for leaving the company, and he thus demanded that Cambio pay him

the severance benefits owed under the consulting agreement.

       In response, Cambio filed this lawsuit in federal district court seeking a declaration that a

change in control had not taken place. Reardon, in turn, filed a counterclaim against Cambio

alleging breach of contract and named IRG, QHR and Triad as additional defendants in the lawsuit,

bringing claims against the latter three companies for common law tortious interference with contract

and statutory procurement of a breach of contract. See Tenn. Code Ann. § 47-50-109.

       Reardon filed a motion for partial summary judgment, contending that as a matter of law a

change in control had occurred as a result of the Triad–QHG merger. The district court granted the

motion.

       The parties proceeded to trial on the remaining issues. The jury found that Cambio had

breached the agreement and awarded Reardon $815,000 in compensatory damages. The jury also

found IRG, QHR and Triad liable on the tortious interference and procurement of a breach of

contract claims, awarding $1,800,000 in punitive damages against Triad, $3,000,000 against QHR

and $200,000 against IRG. Reardon, in response, filed a notice of election of remedies asking for

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common law punitive damages for the Triad and QHR awards but seeking statutory treble damages

for the IRG award, all of which would have allowed him to recover $1,768,582.36 from IRG instead

of $200,000 from this company. The district court denied Reardon’s split-remedy request and

entered judgment on the jury verdict. The companies filed renewed motions for judgment as a matter

of law, new trial and remittitur, each of which the district court denied.

                                                 II.

       The companies on appeal urge us to grant their motion for judgment as a matter of law on

several issues and to order a new trial on several others. They also seek to eliminate the punitive

damages award or at least to reduce it. Reardon, for his part, contends that he should have been

permitted to split his remedies and cross-appeals from the district court’s denial of that request.

                                                 A.

       In reviewing the district court’s denial of a Rule 50 motion for judgment as a matter of law,

we give fresh review to legal questions. K & T Enters., Inc. v. Zurich Ins. Co., 97 F.3d 171, 176 (6th

Cir. 1996). “Judgment as a matter of law is appropriate only when there is a complete absence of

fact to support the verdict, so that no reasonable juror could have found for the nonmoving party.”

Moore v. KUKA Welding Sys. & Robot Corp., 171 F.3d 1073, 1078 (6th Cir. 1999). As to questions

of fact regarding the sufficiency of the evidence, we look to the law of the forum state, K & T

Enters., 97 F.3d at 176, which tells us (unsurprisingly) to “discard all countervailing evidence, take

the strongest legitimate view of the evidence in favor of the non-moving party, and allow all

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Cambio Health v. Reardon, et al.

reasonable inferences in his favor,” Mairose v. Fed. Express Corp., 86 S.W.3d 502, 511 (Tenn. Ct.

App. 2001).

       IRG, QHR and Triad initially argue that, as a matter of law, they had authority to interfere

with the consulting agreement between Cambio and Reardon because they held a majority interest

in Cambio. In doing so, they ask us to extend the holding in Waste Conversion Sys., Inc. v.

Greenstone Indus., Inc., 33 S.W.3d 779, 784 (Tenn. 2000)—which provides a qualified privilege for

parent companies to interfere in the contracts of their wholly-owned subsidiaries—to parent

companies with mere majority interests in their subsidiaries. Thinking that the Tennessee Supreme

Court was better equipped to decide this important matter of state law than we are, we certified the

following question to that Court: “Does a parent company’s qualified privilege to interfere in the

contractual relations of a wholly-owned subsidiary apply when the parent company has a majority

interest in the subsidiary?”

       The Tennessee Supreme Court, with our gratitude, recently answered the certified question.

The rationale behind granting the privilege to the parent company of a wholly-owned subsidiary, the

Court explained, does not apply when the parent owns less than 100% of its subsidiary. While the

interests of a parent and wholly-owned subsidiary “are so closely aligned as to render them the same

entity,” the same unity of interests does not necessarily exist when the parent merely owns a majority

of the subsidiary’s stock. Cambio Health Solutions, LLC v. Reardon, __ S.W.3d __, No. M2006-

00007-SC-R23-CQ, 2006 WL 3626738, at *2 (Tenn. Dec. 14, 2006). As “[t]his case demonstrates,”

the Court added, “the interests of a majority shareholder and minority shareholder can diverge”

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rather “easily.” Id. at *4. And “[w]hen the interests of a parent and subsidiary are not identical, the

reason for treating them as the same entity disappears.” Id. at *5. In the aftermath of this controlling

determination of state law, we (like the district court) must reject the companies’ argument that, as

majority shareholders of Cambio, they were privileged as a matter of law to interfere with the

Cambio-Reardon agreement.

       IRG, QHR and Triad next argue that they are entitled to judgment as a matter of law because

Reardon failed to show (1) that they breached the agreement or (2) that they acted with malice. We

disagree.

       Tennessee recognizes a statutory cause of action for procurement of a breach of contract, see

Tenn. Code Ann. § 47-50-109, and a common law companion claim for tortious interference with

contract, see, e.g., Polk & Sullivan, Inc. v. United Cities Gas Go., 783 S.W.2d 538, 542 (Tenn.

1989); see also Cont’l Motel Brokers, Inc. v. Blankenship, 739 F.2d 226, 229 (6th Cir. 1984). While

the two claims share the same elements, see Polk & Sullivan, 783 S.W.2d at 543 (“[T]he plaintiff

must prove that there was a legal contract, of which the wrongdoer was aware, that he maliciously

intended to induce a breach, and there must have been a breach, proximately caused by his acts,

resulting in damages.”), the claims differ in two respects. The statutory claim “substitut[es] treble

damages for punitive damages.” Id. at 542. And “the statutory claim is in the nature of a penalty,”

so “it, unlike the common law cause of action, requires a ‘clear showing’ of the defendant’s liability”

rather than mere proof by a preponderance of the evidence. Cont’l Motel Brokers, 739 F.2d at 229.

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Cambio Health v. Reardon, et al.

       The companies argue that Reardon did not produce sufficient evidence of breach, an essential

element of either claim. At trial, Reardon presented two theories of breach—that Cambio failed to

pay the severance benefits when they were due and that it filed a declaratory judgment action instead

of invoking the agreement’s mandatory dispute resolution procedure. See Agreement § 13

(providing for an Appeal Committee to handle disputes). By the time the issue went to the jury, the

district court already had ruled as a matter of law that a change in control had occurred and no one

disputed at trial that Cambio had yet to pay Reardon severance benefits. That left only the issue

whether Reardon terminated the agreement for “good reason.” D. Ct. Op. at 9. The agreement lists

seven circumstances that would constitute “good reason,” including “[a]ny material change in

[Reardon’s] title, authorities, responsibilities (including reporting responsibilities) which represents

an adverse change from his status, title, position, or responsibilities (including reporting

responsibilities).” Agreement § 8(C)(i)(a). Ample evidence supports the jury’s finding that the

companies materially altered Reardon’s authority: After the change in control, he was ordered to

report to Dan Moen, rather than to the Cambio Board; employees who once reported to him were

instructed to report to Cambio’s new president—a president selected through a hiring process and

contract negotiation from which Reardon was excluded; and the Cambio Board saw its

responsibilities significantly diminished, if not eliminated altogether.

       Ample evidence also supports the jury’s finding that Cambio breached the agreement by

seeking a declaratory judgment. Reardon showed that the “Appeal Committee” did not meet to

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evaluate and issue a “final and binding decision” on his complaint—as indeed the agreement

required. See Agreement § 13.

       Even if the evidence introduced at trial supported the jury’s breach-of-contract finding, the

companies persist that Reardon failed as a matter of law to prove that they acted with malice. That

is so in part, the companies claim, because the district court defined malice as the “willful violation

of a known right” rather than as “ill will, hatred, or personal spite,” which is how the Tennessee

Supreme Court defined the term in Hodges v. S. C. Toof & Co., 833 S.W.2d 896, 901 (Tenn. 1992);

Br. at 46. Hodges, however, is a retaliatory discharge case, not a tortious interference case, and it

narrows the definition of factual malice in the context of a punitive damages claim filed after a

retaliatory discharge but does not alter the existing requirement that legal malice be proved to

establish a tortious interference claim. As it stands, the Tennessee courts continue to respect the

dichotomy between factual malice and legal malice and hold that legal malice remains an element

of a tortious interference claim. See, e.g., Riggs v. Royal Beauty Supply, Inc., 879 S.W.2d 848, 851

(Tenn. Ct. App. 1994) (approving trial court’s conclusion that tortious interference requires “legal

malice,” which “simply means a wilful violation of a known right”); see also Prime Co. v. Wilkinson

& Snowden, Inc., No. W2003-00696-COA-R3CV, 2004 WL 2218574, at *4 (Tenn. Ct. App. Sept.

30, 2004) (reversing the trial court because it used the factual definition of malice rather than the

legal definition); Crye-Leike Realtors, Inc. v. WDM, Inc., No. 02A01-9711-CH-00287, 1998 WL
651623, at *6 (Tenn. Ct. App. Sept. 24, 1998) (“In [the procurement of breach of contract] context,

malice is the wilful violation of a known right.”) (internal quotation marks omitted).

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       On this record, a jury reasonably could conclude that the companies willfully violated

Reardon’s rights under the agreement. Among other reasons: the companies acted as though a

change in control had occurred when they sought buyouts of minority shareholders but then

disavowed that a change in control had taken place when they dealt with Reardon and his right to

severance benefits; and the companies forced Reardon to run the gauntlet of a federal-court

proceeding, with its costs in time and money, before they would pay the benefits that Cambio owed

him.

       Cambio next argues that Reardon committed a prior material breach of the agreement, which

excused its breach and entitles it to judgment as a matter of law on the breach-of-contract claim.

This argument, too, lacks merit. Cambio says that Reardon violated § 2(b) of the agreement by

neglecting to develop a transition plan six months prior to terminating the agreement. See

Agreement § 2(b) (providing that Reardon must “develop and implement a plan of transition . . .

approved by the Board of Directors and implemented at least six months prior to the termination of

this Agreement” or Reardon’s “departure”). The record shows that Reardon sent a letter to Moen

and QHR President James Stokes on February 6, 2002, in which he voiced concerns about his

marginalization at Cambio and “point[ed] out” that the agreement required him “to develop and

implement a plan of transition . . . which . . . must be approved at least six months prior to the

termination of the agreement.” JA 898. He would “like to remain as CEO of Cambio indefinitely,”

he said, if various issues could be resolved, but if the company chose not to renew his contract, he

felt “an obligation to address the issue of transition.” “In effect,” he wrote, “I believe you already

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Cambio Health v. Reardon, et al.

have a successor/transition plan in mind . . . with the change of Tom Singleton’s status to President

and COO. . . . Should my contract not be renewed, I would agree that Tom should be my successor.”

JA 899.

       Although Reardon acknowledged at trial that he wrote the letter less than six months before

he terminated the agreement, a jury reasonably could find either (1) that Moen and Stokes had

already decided on the transition plan when they named Singleton as President and COO, rendering

Reardon’s obligation to do so moot, or (2) that even if Reardon breached the agreement by failing

to implement a plan, the failure at best constituted a minor, not a material, breach. All of these

arguments considered, the district court properly denied Cambio’s Rule 50 motion for judgment as

a matter of law.

                                                  B.

       The companies next argue that the district court abused its discretion, see Barnes v. City of

Cincinnati, 401 F.3d 729, 743 (6th Cir. 2005), in failing to grant their motion for a new trial. They

offer three theories in support of this argument, the premises for two of which we already have

rejected.

       First, they argue that a new trial should be granted because the district court refused to

instruct the jury that, as majority shareholders of Cambio, they had a qualified privilege to interfere

with the Reardon-Cambio contract. But because the Tennessee Supreme Court now has declined

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Cambio Health v. Reardon, et al.

to extend this privilege to parent companies who own only a majority interest in their subsidiaries,

see Cambio Health Solutions, LLC, 2006 WL 3626738, at *7, this claim must fail.

        Second, the companies complain that the district court did not instruct the jury that malice

requires “hatred, spite, or ill will.” This claim also must fail because, as we have shown, the district

court correctly defined malice as a “wilful violation of a known right.”

        Third, the companies maintain that the district court erred in admitting two pieces of evidence

on relevance and undue-prejudice grounds: that the wife of Cambio officer David Bussone had

multiple sclerosis; and that Cambio repurchased stock from other shareholders. The Federal Rules

of Evidence set a low bar for relevance. See Fed. R. Evid. 401 (defining “relevant evidence” as

“evidence having any tendency to make the existence of any fact that is of consequence to the

determination of the action more probable or less probable than it would be without the evidence”)

(emphasis added). Low though that bar is, the Rules also provide that relevant evidence “may be

excluded if its probative value is substantially outweighed by the danger of unfair prejudice,

confusion of the issues, or misleading the jury.” Fed. R. Evid. 403 (emphasis added).

        The district court provided a thorough, and ultimately permissible, explanation for its

admission of both pieces of evidence. The court admitted the evidence about Bussone’s wife’s

illness because it gave “insight into Moen’s motivations and methods,” namely that Moen put

Bussone to the choice of selling his shares or losing his health insurance at a time when he

particularly needed it. D. Ct. Op. at 20. Any prejudice stemming from this evidence, the court

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Cambio Health v. Reardon, et al.

reasoned, was created by the companies themselves when Moen testified on cross-examination that

Bussone was a “motivated seller,” JA 530–31, eager to take the buyout to keep his health benefits,

D. Ct. Op. at 20.

       The court found the evidence about the buyouts relevant “because it tend[ed] to support

Reardon’s theory that the Companies had embarked on a plan to ‘clean up’ Cambio’s ownership

structure by consolidating ownership and purchasing minority owners’ shares,”—a plan not revealed

to Reardon, a plan that bolstered his theory that he had been marginalized, a plan that in short

supported his termination of the agreement for “good cause.” D. Ct. Op. at 19. Nor did the district

court (or do we) see any undue prejudice resulting from the evidence given that “the Companies

essentially admit that this evidence is not prejudicial when they argue . . . that the buyouts are not

evidence of anything sinister and are not an uncommon occurrence in business.” D. Ct. Op. at

19–20. No abuse of discretion occurred in the admission of this evidence.

                                                 C.

       The companies also take issue with the punitive-damages award, maintaining that insufficient

evidence supports it and that it is constitutionally excessive. Under Tennessee law, punitive

damages are proper “only if . . . a defendant has acted either (1) intentionally, (2) fraudulently,

(3) maliciously, or (4) recklessly.” Hodges, 833 S.W.2d at 901. Ample proof permitted a jury to

conclude that the companies acted intentionally. See id. (“A person acts intentionally when it is the

person’s conscious objective or desire to engage in the conduct or cause the result.”). Reardon

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Cambio Health v. Reardon, et al.

introduced evidence that the companies staged the buyout of the minority shareholders; marginalized

him to the point that he was forced to resign; and disregarded the agreement’s efficient dispute

resolution process in favor of forcing Reardon to slog out the resolution of his rights in district court.

        Also unavailing is the constitutional challenge to the award. We give fresh review to the

district court’s assessment of the issue, see State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S.
408, 418 (2003), using the Supreme Court’s three guideposts to determine whether the award is

“grossly excessive,” BMW of N. Am., Inc. v. Gore, 517 U.S. 559, 568 (1996). We consider “(1) the

degree of reprehensibility of the defendant’s misconduct; (2) the disparity between the actual or

potential harm suffered by the plaintiff and the punitive damages award; and (3) the difference

between the punitive damages awarded by the jury and the civil penalties authorized or imposed in

comparable cases.” State Farm, 538 U.S. at 418; see also BMW of N. Am., 517 U.S. at 575.

        In considering the first guidepost, we ask whether: (1) the harm was physical or economic;

(2) the defendants’ conduct “evinced an indifference to or a reckless disregard of the health or safety

of others”; (3) “the conduct involved repeated actions” or merely “an isolated incident”; and (4) the

harm resulted from “intentional malice, trickery . . . deceit, or mere accident.” State Farm, 538 U.S.

at 419. The companies offer little explanation why this guidepost works in their favor—just one

conclusory sentence—and apparently for good reason. Although Reardon’s harm was economic in

nature and the companies’ conduct did not show any disregard for others’ health and safety, cf. Philip

Morris USA v. Williams, __ S. Ct. __, No. 05-1256, 2007 WL 505781 (Feb. 20, 2007), the conduct

was not isolated and fairly could be considered malicious. The companies’ isolation of Reardon, their

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Cambio Health v. Reardon, et al.

plan to buy out the minority shareholders and thus force Reardon out and their decision to file a

lawsuit against Reardon rather than invoke the alternative-dispute-resolution process required by the

agreement all support the award.

       As to the second guidepost, the Court has “been reluctant to identify concrete constitutional

limits on the ratio between harm . . . and the punitive damages award,” but it has indicated that

“[s]ingle-digit multipliers are more likely to comport with due process.” State Farm, 538 U.S. at

424–25. Reardon received a total compensatory damages award of $815,000 plus $69,291.18 in

prejudgment interest, bringing the total award against the companies to $884,291.18. That makes

the ratio of punitive damages to compensatory damages 5.65 to 1. Not only is this well within the

Supreme Court’s single-digit prescription, but the companies offer no explanation why the award

should be invalidated under this criterion.

       The companies place most of their eggs in the third-guidepost basket, emphasizing the

disparity between the award and the civil penalties available under state law for this conduct. The

statutory penalty for inducing a breach of contract under state law, the companies note, is treble

damages, Tenn. Code Ann. § 47-50-109, which (in their view) suggests that we should cap

Reardon’s $5 million punitive damages award at three times his compensatory damages award—or

roughly $2.7 million. But the companies overlook the fact that Tennessee law permits a prevailing

plaintiff to choose between the common-law and the statutory remedies “to realize the maximum

recovery available under the fact finders’ findings.” Concrete Spaces, Inc. v. Sender, 2 S.W.3d 901,

909 (Tenn. 1999); see also Buddy Lee Attractions, Inc. v. William Morris Agency, Inc., 13 S.W.3d

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343, 357 (Tenn. Ct. App. 1999). Reardon has the right, therefore, to choose the scheme that affords

him the greatest recovery—in this case, common law punitive damages—and because the award

under that scheme does not offend due process, we decline to disturb it.

       The companies nevertheless maintain that they cannot be liable for punitive damages because

the jury instruction did not mention—and the verdict form did not include a blank

for—compensatory damages for the tortious interference claim. Without assessing compensatory

damages, the companies urge, the jury could not impose punitive damages. On the final day of trial,

the district court informed the parties that it planned to draft a damages instruction for the tortious

interference claim because the parties had not supplied one. Reardon’s counsel stated that he

understood that the compensatory damages his client would receive on the tortious interference

claims were necessarily the same as those he would recover on his breach of contract claim, because

one of the elements of tortious interference is breach of contract. The following exchange then took

place between the companies’ counsel and the district court:

       The Court: But it’s your position that if they find common law interference, then
       automatically the damages are the same as breach of contract. They have to find
       breach of contract. There can’t be duplicative damages, so basically that’s it. . . . So
       we do not need any additional damages instruction on tortious interference. We just
       need to have them find or not that the common law or statutory seven elements have
       been found.
       Mr. Eastwood: That’s our understanding too.

JA 728. Having not only failed to object to the proposed instruction and jury form, but also having

clearly endorsed it, the companies have waived this argument. See, e.g., Preferred RX, Inc. v. Am.

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Nos. 04-6485 and 05-5041
Cambio Health v. Reardon, et al.

Prescription Plan, Inc., 46 F.3d 535, 547–48 (6th Cir. 1995) (finding waiver after counsel

acquiesced to jury instruction including punitive but not compensatory damages for fraud claim).

And because the damages flowing from the breach of contract—Reardon’s lost salary and severance

benefits—were the same as those stemming from the tortious interference that caused the breach,

we find no plain error here. See Fed. R. Civ. P. 51(d)(2); id. at 548 (concluding that no plain error

occurred because defendants’ fraud “caused the breach of contract . . . . [and] the damages

proximately caused by defendants’ fraud and . . . breach of the contract were the same”).

       The companies next urge us to reduce the compensatory damages award from $815,000 to

$625,205.48 because Reardon was already paid $189,794.52 in salary but allegedly performed no

services for Cambio from the date of his resignation (March 14, 2002) to the date that resignation

became effective (August 31, 2002). Br. at 56. Reardon’s testimony, however, speaks to the

contrary. See JA 623 (Reardon testifying he “was still involved [in Cambio’s business] until August

31, 2002”); id.(Reardon testifying that he was told he did not have to work, but that “Mr. Moen and

others asked me to follow up on various accounts, and I did”); see also JA 847 (letter from Chairman

of Cambio’s Board, stating Cambio would “pay [Reardon’s] compensation for the remaining term

of the agreement”). And the jury already had reduced Reardon’s compensatory damages award from

$854,148.72—the amount contemplated in the employment agreement—to $815,000, an amount that

the district court presumed “was an equitable reduction for Reardon’s reduced responsibilities during

this period.” D. Ct. Op. at 32. In the light of these facts, we refuse to alter the jury’s award or to

reverse the district court’s judgment affirming it. See, e.g., Thrailkill v. Patterson, 879 S.W.2d 836,

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841 (Tenn. 1994) (“The amount of the verdict is primarily for the jury to determine, and next to the

jury the most competent person to pass upon the matter is the judge who presided at the trial and

heard the evidence.”); see also Tenn. R. App. P. 13(d).

                                                  III.

       In his cross-appeal, Reardon contends that the district court erred in refusing to grant his

request for split remedies. As Reardon sees it, he should have been able to collect common-law

punitive damages from QHR and Triad and statutory treble damages from IRG—which would have

allowed him to collect more than $1.7 million from IRG rather than the $200,000 the jury awarded

under the common law.

       Tennessee allows a plaintiff who brings a common-law tortious interference and statutory

procurement of a breach of contract to choose between statutory treble damages and common-law

punitive damages. See, e.g., Buddy Lee Attractions, 13 S.W.3d at 355. Reardon points us to no

authority, however, saying that the plaintiff may saddle one defendant with the entire statutory

penalty while seeking common law damages from the others. And several cases suggest that the

plaintiff must elect between the two options, not add them up. See Concrete Spaces, 2 S.W.3d at

909 (“[N]o inequity results from allowing the plaintiff to choose one of the claims upon which to

realize its maximum recovery.”) (emphasis added); Buddy Lee Attractions, 13 S.W.3d at 355

(“[P]laintiff is required to elect between remedies.”) (emphasis added). As the district court correctly

noted, moreover, allowing Reardon to recover the entire statutory amount—more than $1.7

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Nos. 04-6485 and 05-5041
Cambio Health v. Reardon, et al.

million—from IRG, the defendant the jury found least culpable, would “subvert the intent of the

jury” and “significantly inflate the punishment imposed on IRG relative to the other two entities,”

QHR and Triad. JA 286.

                                               IV.

       For these reasons, we affirm.

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