Central Indiana Podiatry, P.C., Northwest Surgery Center, LLC, d/b/a Foot & Ankle Surgery Center, f/k/a Foot & Ankle Surgery Center, LLC and Anthony E. Miller, D.P.M., Appellants-Plaintiffs,
Barnes & Thornburg, LLP, Appellee-Defendant.
from the Marion Superior Court The Honorable Cynthia J.
Ayers, Judge Trial Court Cause No. 49D04-1210-PL-41939
ATTORNEYS FOR APPELLANT James A. Knauer Steven E. Runyan
Kroger, Gardis & Regas, LLP Indianapolis, Indiana.
ATTORNEYS FOR APPELLEE Forrest Bowman, Jr. Jennifer K. Bowman
Bowman & Bowman Mark Crandley Barnes & Thornburg, LLP
Central Indiana Podiatry, P.C. ("CIP"), Northwest
Surgery Center, LLC d/b/a Foot & Ankle Surgery Center
f/k/a Foot & Ankle Surgery Center, LLC
("FASC"),  and Anthony
Miller, D.P.M. ("Miller") (collectively "the
Miller Parties") appeal summary judgment for Barnes
& Thornburg, LLP ("B&T"). The Miller
Parties present multiple issues for our review, which we
consolidate and restate as:
1. Whether the Miller Parties' allegations of fraud
preclude B&T from relying on the Release Agreement; and
2. Whether the terms of the Release Agreement preclude the
Miller Parties from suing B&T for the alleged acts of
and Procedural History
B&T had provided legal services to Miller, as owner and
sole shareholder of CIP and FASC, since the early 1990's.
The current case stems from a disagreement regarding legal
The Vogel Federal Litigation
On November 7, 2005, Thomas Vogel, D.P.M., a former employee
of CIP and FASC, filed a federal claim ("Vogel Federal
Litigation") against the Miller Parties alleging, among
other things, "anti-kickback violations, mail, wire, and
healthcare fraud, money laundering, racketeering activity,
breach of contract, back wages, conversion, and offenses
against property." (Br. of Appellee at 6.)
On December 28, 2005, B&T, on behalf of the Miller
Parties, filed an answer to the complaint, a counterclaim,
and a request for an injunction. B&T partner William Pope
was the billing attorney for the work involved in the action,
but three other B&T partners, J. Michael Grubbs, Thomas
Shea, and John Koenig, also entered appearances.
Vogel filed three motions for summary judgment in the Vogel
Federal Litigation between February 8 and March 8, 2006,
causing B&T to spend extra time on the case. On May 17,
the court consolidated the Vogel Federal Litigation with a
claim brought by another former Miller employee, Yong Chae,
D.P.M., which included similar allegations. B&T also
represented the Miller Parties in the Chae claim. The court
set a hearing for May 25, 2006, to consider arguments
regarding the Miller Parties' motions for injunction in
During the pendency of the Vogel Federal Litigation and the
Chae claim, Miller complained several times to Pope about the
legal fees B&T was charging him. In response, Pope
proposed an agreement that indicated Miller had been billed,
as of March 31, 2006, attorney fees of $138, 008.50 in the
Vogel Federal Litigation and $4, 082.00 in the Chae claim,
for a total of $142, 090.50. As of the date of the proposed
agreement, Miller had paid $23, 886.12. The proposed
agreement contained provisions regarding payment and a cap on
Miller's legal fees. Pope advised Miller to retain
independent counsel to review the agreement. On May 16, 2006,
Miller rejected Pope's proposed agreement.
At the hearing on May 25, the judge in the Vogel Federal
Litigation advised Miller and Vogel to try to reach a
settlement. During the negotiations, Miller expressed an
interest in maintaining a professional relationship with
Vogel because Vogel would produce additional revenue for FASC
by performing surgeries at FASC. Koenig advised Miller
against continuing the relationship because Vogel had
previously sued Miller, accused Miller of dishonesty, and
allegedly operated on patients while he was impaired. After
many hours of negotiation, Miller reached settlement
agreements with both Vogel and Chae.
The Vogel settlement required multiple agreements among the
parties to be entered into within thirty days of the
1. The parties agree to simultaneously enter into the
following agreements within 30 days after the date of this
a) A Mutual Release from the Restrictive Covenant in the
Employment Agreement between CIP and Dr. Vogel.
b) An Option Agreement between FASC and Dr. Vogel permitting
Dr. Vogel to purchase up to 2% of the ownership of FASC.
c) A Subscription Agreement for the purchase of at least one
share of FASC containing a provision requiring the
shareholder to exclusively perform all surgeries at FASC
unless the patient's condition or patient's choice
requires that the surgery be performed elsewhere.
d) A Mutual Waiver and Release of all claims raised in or
that could have been raised in the lawsuit.
e) A Dismissal of the lawsuit with prejudice via a
stipulation that includes all allegations of fraud.
f) A Mutual Non-disparagement Agreement.
(App. at 350.)
Because of the agreement to transfer a portion of FASC
ownership to Vogel, Pope advised Miller he would need to
change FASC's status as an "S" subsidiary of
CIP for federal income tax purposes. To do so, Pope proposed
the creation of a new limited liability company
("LLC") in which FASC and Vogel would have
ownership interests, thus preserving the "S"
subchapter election. Pope spoke with Miller on May 30 and
June 1, 2006, regarding this plan. Pope prepared
documentation to create the new LLC around that time as well.
Pope sent the documentation regarding the proposed LLC
creation to Vogel's attorney, Paul Black, on June 19,
Also in early June 2006, Miller and Pope had multiple
telephone conversations regarding legal fees Miller owed
B&T. Around this time, Miller and Pope reached an oral
agreement about the fees. On June 19, 2006, Pope sent Miller
the written expression of that oral agreement, entitled the
Settlement and Release Agreement ("Release
Agreement"). Pope told Miller that B&T would require
Miller to consult independent counsel before executing the
Release Agreement. The Release Agreement also provided Miller
was required to consult independent counsel before executing
the Release Agreement.
Miller consulted Jim Knauer, who had represented the Miller
Parties in other matters in the past. Pope spoke with Knauer
via telephone on June 20, 2006, and Knauer indicated he had
reviewed the Release Agreement. On June 22, 2006, at 5:00
p.m., Pope met with Miller to discuss the LLC Documentation
and the Release Agreement. Miller confirmed he had discussed
the Release Agreement with Knauer and "said Knauer told
him the terms proposed were standard and he would have to
accept them to get the fee reductions." (Id. at
123.) By the time Miller reviewed the Release Agreement, he
had incurred legal fees in the Vogel Federal Litigation and
the Chae case in excess of $190, 000.00. Miller signed the
Release Agreement. The meeting lasted approximately ninety
The terms of the Release Agreement provided, in relevant
1. The Miller Parties shall pay to B&T the total sum of
One Hundred Forty-Five Thousand Dollars and No Cents ($145,
000.00) by check, made payable to Barnes & Thornburg,
LLP, which check shall be delivered to B&T on or before
June 30, 2006.
2. Upon payment of the amount set forth in paragraph 1
hereof, the Miller Parties are released and forever
discharged by B&T from the payment of any further amounts
to B&T for costs or services performed on the
Lawsuits. The Miller Parties are
expressly not released or discharged from the payment for any
costs or fees associated with any services performed by