The Care Group Heart Hospital, LLC, Appellant/Cross-Appellee (Defendant),
Roderick J. Sawyer, M.D., Appellee/Cross-Appellant (Plaintiff).
Argued: December 7, 2017
from the Marion Superior Court, No. 49D10-1208-PL-32513 The
Honorable David J. Dreyer, Judge
Petition to Transfer from the Indiana Court of Appeals, No.
ATTORNEYS FOR APPELLANT/CROSS-APPELLEE John R. Maley Peter J.
Rusthoven Leah L. Seigel Barnes & Thornburg LLP
ATTORNEYS FOR PETITIONER ST. VINCENT MEDICAL GROUP, INC.
David B. Honig Andrew B. Howk Hall, Render, Killian, Heath
& Lyman, P.C. Indianapolis, Indiana
ATTORNEYS FOR APPELLEE/CROSS-APPELLANT Kevin W. Betz Sandra
L. Blevins Benjamin C. Ellis Betz Blevins Indianapolis,
ATTORNEYS FOR AMICUS CURIAE INDIANA LEGAL FOUNDATION INC.
Julia Blackwell Gelinas Maggie L. Smith Frost Brown Todd LLC
ATTORNEYS FOR AMICUS CURIAE DEFENSE TRIAL COUNSEL OF INDIANA
Philip E. Kalamaros Hunt Suedhoff Kalamaros LLP Saint Joseph,
Michigan Lucy R. Dollens Quarles & Brady LLP
are free to choose the terms of their agreements, and Indiana
courts firmly defend this freedom of contract by enforcing
doctor worked as a cardiologist and was also a member-owner
of a hospital. He agreed with his employer and with the
hospital that if his employment is "terminated for any
reason"-that is, upon "any termination"-his
ownership interest must be discontinued and redeemed.
that "any termination" means just
that-any termination, for
any reason. The hospital thus did not breach
the agreement by paying out the doctor's ownership
interest after his employment terminated. It did, however,
breach the agreement by delaying the payout, so the doctor is
entitled to interest.
hold that the trial court did not abuse its discretion in
awarding the doctor discovery sanctions of $27, 233.19 in
attorney fees and expenses.
therefore affirm in part, reverse in part, and remand to the
and Procedural History
Roderick Sawyer worked as a cardiologist for St. Vincent
Medical Group, Inc. ("the Medical Group"). He was
also a member-owner of The Care Group Heart Hospital, LLC
("the Hospital"). These two arrangements stood on
three agreements: an employment agreement, an operating
agreement, and a joinder agreement.
employment agreement was between Dr. Sawyer and the Medical
Group and governed his ten-year term of employment as a
cardiologist. The operating agreement was between Dr. Sawyer
and the Hospital and prescribed payout of his ownership
interest in the Hospital. And the joinder agreement was among
all three and conditioned Dr. Sawyer's continued
ownership interest in the Hospital on his continued
employment with the Medical Group. The joinder agreement
[w]ithin ninety (90) days of any termination of employment
between Physician and [the Medical Group] (other than a
termination pursuant to Section 4.4(c) of the Agreement), . .
. Physician and [the Hospital] shall cause Physician to be
redeemed of his interest in [the Hospital] such that,
following such redemption, Physician shall have no continuing
direct or indirect membership, ownership or investment
interest in [the Hospital]. (emphases added)
operating agreement then supplied a formula for calculating
Dr. Sawyer's redemption amount at the time of his
"involuntary withdrawal, " which includes "the
termination of employment or any material agreement [Dr.
Sawyer] is a party to with the [Medical Group]."
Medical Group terminated Dr. Sawyer's employment on July
22, 2011. Almost eight months later, the Hospital paid Dr.
Sawyer $196, 787- his redemption amount based on the
operating agreement's formula.
Sawyer sued the Medical Group and the Hospital. Against the
Medical Group, he claimed tortious interference with business
relationships; breach of the duty of good faith and fair
dealing; and breach of the employment agreement, which caused
him to lose both his employment and his ownership interest in
the Hospital. Against the Hospital, he brought a
Hospital filed dispositive motions throughout the litigation:
for partial dismissal, for summary judgment, and for judgment
on the evidence. Each motion relied on a plain reading of the
joinder agreement, arguing no breach in the Hospital
discontinuing and redeeming Dr. Sawyer's ownership
interest. The trial court denied all these motions as to the
joinder agreement, but it granted summary judgment to the
Hospital as to the operating agreement. A jury returned a
verdict against the Medical Group for $1.1 million, which has
been paid to Dr. Sawyer. The jury also returned a verdict of
$470, 000 against the Hospital for breach of the joinder
Hospital moved to correct error, reiterating that there was
no breach in discontinuing and redeeming Dr. Sawyer's
ownership interest- only in delaying the payout after the
90-day deadline. The Hospital asked the court to correct the
jury's $470, 000 award by entering judgment on the
evidence for $6, 559.60-the interest on the five-month delay
at the statutory rate of eight percent. The court denied the
the court ruled on the last of many discovery disputes that
tangled nearly every stage of the litigation. It ordered the
Hospital and Medical Group to pay a $27, 233.19 sanction
award to Dr. Sawyer.
Hospital appealed the $470, 000 judgment, arguing that the
trial court erred in denying the Hospital's motions under
Indiana Trial Rules 12(B)(6), 50, and 59(J). Dr. Sawyer
cross-appealed, arguing that the trial court erroneously
granted summary judgment to the Hospital as to the operating
agreement, and that the $27, 233.19 in attorney fees and
expenses was an inadequate sanction.
Court of Appeals affirmed both the partial summary judgment
for the Hospital and the judgment against the
Hospital. The Care Group Heart Hosp. v.
Sawyer, 80 N.E.3d 190, 210 (Ind.Ct.App. 2017). But it
reversed the sanction award, remanding for re-evaluation and
re-apportionment among the defendants. Id.
Hospital and the Medical Group separately petitioned to
transfer. We granted transfer, vacating the Court of Appeals
opinion. Ind. Appellate Rule 58(A).
two questions. First, did a contract-interpretation
error-which we review de novo-pervade the trial court's
rulings on the Hospital's dispositive motions? See
State Farm Mut. Auto. Ins. Co. v. Jakubowicz, 56 N.E.3d
617, 619 (Ind. 2016).
did the trial court abuse its discretion in awarding
discovery sanctions of $27, 233.19 to Dr. Sawyer? See
McCullough v. Archbold Ladder Co., 605 N.E.2d 175, 180