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Chopra v. Physicians Medical Center, LLC

United States District Court, E.D. Michigan, Southern Division

March 23, 2018

VARUN CHOPRA, et al., Plaintiffs,



         Before the court are Plaintiffs' motion for leave to file an amended complaint. (Dkt. # 77) and cross-motions for summary judgment. (Dkt. # 59, 61.) The court having reviewed full briefing on all three motions, concludes a hearing is unnecessary. See E.D. LR7.1(f)(2). For the reasons discussed herein, the court will deny Plaintiffs' motion for leave to amend and deny both parties' motions for summary judgment.

         I. BACKGROUND

         Plaintiff Varun Chopra graduated from American University of Antigua-a medical school in the Caribbean-in 2009, but sought to practice medicine in the United States. (Dkt. # 61-2, Pg. ID 13465.) To do so, he needed to be accepted into and complete a medical residency in either the United States or Canada. See American Medical Association, Residency Program Requirements for International Medical Graduates, available at requirements-international-medical-graduates. A medical residency program[1] screens recent medical school graduates to determine whether they are qualified to join the hospital's training program, which allows the graduates to treat patients under the supervision of certified, experienced physicians.

         Plaintiff applied to residency programs throughout Canada and the United States for seven years-from 2009 until 2016. (Dkt. # 61-2, Pg. ID 1351.) Despite applying to residency programs in three different specialties-family medicine, psychiatry, and internal medicine-he received neither an interview nor an offer for any residency positions in the United States. (Id. at 1345, 1352.) He interviewed at seven residency programs in Canada, but similarly received no offers. (Id. at 1352.)

         In 2016, a family friend introduced Plaintiff's father, Satish Chopra, to Parminder Minhas[2] whose son and daughter were both enrolled in the residency program at Defendant Physicians Medical Center, LLC, d/b/a Pontiac General Hospital (“the Hospital”), previously known as Oakland Physicians Medical Center. According to Varun Chopra, Minhas[3] “told there was an opportunity if we paid $400, 000, I could-- because he knew that I was in search of a residency position for several years, so he came to my father, you know, with this proposal.” (Dkt. # 61-2, Pg. ID 1348.) According to Satish Chopra he met with Minhas who “said they [the Hospital] want $400, 000. I said, are you out of your mind? $400, 000 for the residency? Who sells the seats? This was news to me. I never knew this thing that the hospital sells the seats. It was news to me. I was really almost shocked. He said, no, you have to donate. I said, $400, 000. It's demand money.” (Dep. S. Chopra, Dkt. # 61-3, Pg. ID 1397.) Minhas had previously donated $250, 000 to the Hospital. (Dkt. # 61-3, Pg. ID 1405.)

         Minhas allegedly arranged for Plaintiffs' parents, Satish and Poonam Chopra, also party to this case, to meet Defendant Hospital's representatives, Defendants' Sanyam and Priyam Sharma. Varun Chopra and his parents visited the Hospital, which was either in bankruptcy or had recently come out of bankruptcy at the time. (Dkt. # 61-3, Pg. ID 1400; Dkt. # 52-2, Pg. ID 1040.) The parties dispute the details of the numerous communications and meetings that occurred next, but undisputedly, Plaintiffs' Satish and Poonam Chopra paid $400, 000 to Defendant Hospital by two checks. The next day Plaintiff Varun Chopra and Defendant Hospital's representative, Defendant Sanyam Sharma, signed a residency agreement (“the Agreement”), thereby accepting Plaintiff to the Hospital's residency team, and permitting him to treat patients here in Michigan.

         A residency agreement is a standard contract the Hospital uses for each of its residents. (Dep. N. Hemady, Dkt. # 61-7, Pg. ID 1546.) The Agreement details the terms of the residency including the resident's duties to patients and the compensation owed by the Hospital to the resident. (Dkt. # 1-3, Pg. ID 13-16.) The Agreement also includes a termination provision allowing the Hospital to terminate or not renew the Agreement at its discretion if it finds that the resident has failed to fulfil his/her obligations under the Agreement. (Id.) Plaintiffs allege that Defendants indicated that Chopra needed a signed residency agreement “in order to participate in the residency program at the Hospital.” (Dkt. # 1, Pg. ID 3.) Plaintiffs allege that Defendants “would not sign the Residency Agreement unless and until the Hospital was paid $400, 000.” (Dkt. # 1, Pg. ID 3.) There is no mention of the $400, 000 payment or any required payment to the Hospital in the Residency Agreement.

         Following the $400, 000 payment, Plaintiff Varun was contacted by the Hospital's Family Medicine Residency Program Administrator, Carol Samson, congratulating him on his admission to the Hospital's residency program. Plaintiff, however, had not yet submitted an application to the residency program. (Dkt. # 61-2, Pg. ID 1346.) In fact, Samson had not yet opened a file for Plaintiff when the Program Director, Dr. Nick Hemady, informed her that Plaintiff had been accepted and would be coming in to meet with her. (Dep. C. Samson, Dkt. # 52-4, Pg. ID 1100.)

         Plaintiff sent his Canadian residency application to Samson and she allegedly indicated it would not be sufficient and he would need to apply through the national system. (Dkt. # 61-2, Pg. ID 1346.) Plaintiff then logged onto the national Electronic Residency Application Service (“ERAS”) to apply to Pontiac General Hospital's program. He no longer possessed his most recent letters of recommendation so he included his letters from his medical school professors, written seven years earlier, instead. Samson allegedly “said those will work. We just need to fill out your file.” Id.

         Following this transaction, both the Hospital and Varun Chopra began to make arrangements for Chopra to begin his formal training on November 1, 2016. For example, the Hospital assisted Chopra in applying for his J-1 non-immigrant visa, which was legally required before he could begin the residency program. Additionally, Samson enrolled Chopra in the Hospital's online intranet to allow him to access residency documents. (Dkt. # 59 Pg. ID 1266.)

         On September 28, 2016, Chopra and the Hospital signed a second contract to allow Chopra to begin the Hospital's Observership Program. (Dkt. # 1, Pg. ID 3.) The Observership Program “expose[s] the Observer to the provision of patient medical care with the understanding that such program will enable the Observer to assume the duties of a Resident. . . .” (Dkt. # 1-4, Pg. ID 17.) Defendants argue that participation in the Oberservership Program is a part of the residency program. (Dkt. # 59, Pg. ID 1271-73.) According to Defendants the Observership Program is made available when a resident's “legally required medical licensure and non-immigrant visa” are pending and as a result s/he cannot participate in the residency program activities, as was the case with Chopra. (Dkt. # 59, Pg. ID 1265.) (Dep. S. Sharma Dkt. # 61-5, Pg. ID 1470.) Chopra participated in the Observership Program from October 3, 2016 through October 26, 2016. (Dkt. #1, Pg. ID 3.)

         On October 26, 2016, Chopra became disassociated from the residency program; the parties dispute how and why. Plaintiffs assert that Defendant Priyam Sharma notified Plaintiff Poonam Chopra by telephone that Varun Chopra was summarily dismissed from the residency program. (Dkt. # 1 Pg. ID 4.) Poonam Chopra testified that Priyam told her that she and the Medical Director of the Residency Program Dr. Nikil Hemady had a meeting and “decided Varun is not joining the program.” (Dep. P. Chopra, Dkt. # 61-4, Pg. ID 1440.)

         In contrast, Defendants argue that Priyam Sharma telephoned Plaintiff Poonam Chopra regarding Varun Chopra's disengagement from the program. Specifically, Priyam Sharma could not testify to whether Varun Chopra withdrew from the program or the Hospital terminated him from the program. She only remembered that she called Poonam Chopra to discuss Varun Chopra “ending the program” and “that there was a disengagement between Varun and the hospital. By whose side, who did what, I did not know.”[4] (Dep. P. Sharma, Dkt. # 61-6, Pg. ID 1511, 1514.) In any event, Poonam Chopra then telephoned her son regarding his participation in the program.

         On October 28, 2016, Varun Chopra emailed Dr. Hemady stating in part, “It was very disappointing to hear that I will not be starting my post graduate training at Pontiac general hospital. Unfortunately, I have only been told through second hand sources that I will not be starting the program.” (Dkt. # 1-6.) Defendant Sanyam Sharma sent a letter to Varun Chopra on November 1, 2016 stating, “The purpose of this letter is to confirm that you no longer have a relationship with Pontiac General Hospital due to your withdrawal from the residency program effective November 1, 2016.” (Dkt. # 1-5, Pg. ID 19.) Varun Chopra returned to Canada on November 2, 2016. Thereafter, Plaintiffs Satish and Poonam Chopra attempted to secure a refund of their $400, 000, but Defendants refused to return it asserting it was a voluntary donation.

         A. Procedural History

         In light of these events, Plaintiffs filed this action against Defendants and alleged claims for breach of contract, fraud in the inducement, and civil conspiracy. Plaintiffs requested leave to amend their complaint to add claims of conversion. (Dkt. # 25.) The court denied Plaintiffs' amendment as futile and also granted Defendants' Motion to Dismiss Plaintiffs' fraud and civil conspiracy claims, (Dkt. # 57), leaving only Plaintiffs' breach of contract claim. (Dkt. # 57.) Due to egregious discovery violations by Defendants, this court further ordered pursuant to Fed.R.Civ.P. 37(b)(2)(A)(i), “that the Donated Funds in the amount of $400, 000 were in fact an entry fee, and a mandatory component of the terms of the Residency Agreement, operating as a condition precedent to Plaintiff Varun Chopra's entry into Defendants' Residency Program.” (Id. at 1247.) Both parties filed motions for summary judgment. (Dkt. # 59, 61.)

         Prior to the hearing on the parties' cross-motions for summary judgment, the court issued an order directing the parties to be prepared to address certain legal issues that the court found to be particularly unclear in the briefing and in need of elaboration. Specifically, the following subjects were included in the court's order:

(1) whether Plaintiffs' claim for breach of contract includes allegations of an implied in fact contract or an implied in law contract which survive Defendants' motion;
(2) whether Plaintiffs' complaint includes allegations that Varun Chopra was a third-party beneficiary to any such contract; and
(3) whether Plaintiffs assert any claim based on agency.

(Dkt. # 75.) At request of the parties, the court converted the motion hearing to a status conference, prior to which Plaintiffs filed a motion for leave to file “Amended Complaint to Conform to Evidence Established During Discovery” and attached a proposed amended complaint. (Dkt. # 77.) Defendants filed a response opposing the motion (Dkt. # 82), and Plaintiffs filed a reply. (Dkt. # 83.) The court will now address each of the three pending motions.

         II. STANDARD

         A. Leave to Amend

         According to Federal Rule of Civil Procedure 15(a)(2), after the time allotted under Rule 15(a)(1) has expired, “a party may amend its pleading only with the opposing party's written consent or the court's leave. The court should freely give leave when justice so requires.” Although the rule embodies a liberal amendment policy, leave to amend may be appropriately denied “when there is ‘undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc.'” Brown v. Chapman, 814 F.3d 436, 443 (6th Cir. 2016) (quoting Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962)).

         B. Summary Judgment

         Summary judgment is proper “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “In deciding a motion for summary judgment, the court must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party's favor.” Sagan v. United States, 342 F.3d 493, 497 (6th Cir. 2003). The movant has the initial burden of showing the absence of a genuine dispute as to a material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). “[T]hat burden may be discharged by showing . . . that there is an absence of evidence to support the nonmoving party's case.” Bennett v. City of Eastpointe, 410 F.3d 810, 817 (6th Cir. 2005) (internal quotation marks omitted).

         The burden then shifts to the nonmovant, who must put forth enough evidence to show that there exists “a genuine issue for trial.” Horton v. Potter, 369 F.3d 906, 909 (6th Cir. 2004) (citation omitted). Summary judgment is not appropriate when “the evidence presents a sufficient disagreement to require submission to a jury.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 243 (1986). In evaluating a summary judgment motion, “the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial . . . credibility judgments and weighing of the evidence are prohibited.” Moran v. Al Basit LLC, 788 F.3d 201, 204 (6th Cir. 2015) (internal quotation marks and citations omitted).


         The present case is before the court under its diversity jurisdiction. Plaintiffs are legal residents of Canada. Defendants are a Michigan limited liability company with its principal place of business in Pontiac, Michigan, and the Sharmas, [5] allegedly the majority owners of Defendant Hospital with Priyam Sharma serving as the Chief Executive Officer and Sanyam Sharma serving as the President. As such, the court will apply Michigan law with respect to its review of Plaintiffs' breach of contract claim and Plaintiffs' proposed amendments to said claim.

         A. ...

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