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Independent Health Services, Inc. v. Quality Choice Healthcare, Inc.

United States District Court, S.D. Mississippi, Northern Division

October 15, 2014

INDEPENDENT HEALTH SERVICES, INC., Plaintiff,
v.
QUALITY CHOICE HEALTHCARE, INC., Defendant.

MEMORANDUM OPINION AND ORDER DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT

HALIL SULEYMAN OZERDEN, District Judge.

BEFORE THE COURT is a Motion for Summary Judgment [18] filed by Plaintiff Independent Health Services, Inc. Defendant Quality Choice Healthcare, Inc. has filed a Response [22] and Plaintiff has filed a Rebuttal [26]. Having considered the pleadings on file, the briefs and arguments of the parties, the record, and relevant legal authorities, the Court finds that Plaintiff's Motion for Summary Judgment [18] should be denied.

I. BACKGROUND

A. Factual Background

This action arises from an open account contract between Plaintiff Independent Health Services, Inc. ("Plaintiff") and Defendant Quality Choice Healthcare, Inc. ("Defendant"). Plaintiff is an institutional pharmacy located in Rainesville, Alabama, that fills prescription medications for various correctional facilities. Aff. of Myra L. Sanderson [18-1] at p. 1. Prior to September 1, 2012, Plaintiff had directly supplied prescription drugs to Hinds County, Mississippi ("Hinds County") for use in its correctional facilities, including the Hinds County Detention Center, the Hinds County Penal Farm, and the City of Jackson Jail. Id. On August 26, 2012, Hinds County entered into a contract with Defendant which called for Defendant to provide comprehensive medical services for inmates of the three correctional facilities located within Hinds County. Aff. of Kathy Rudolph-Petrino [22-1] at p. 1.

Pursuant to the contract with Hinds County, Defendant negotiated with Plaintiff for Plaintiff to supply prescription drugs to inmates in the three correctional facilities. Id. Plaintiff maintains that it made no representations to Defendant about the pricing formula of the medications, other than that the pricing formula would remain the same as it had been with Hinds County prior to Defendant's involvement. Aff. of Sanderson [18-1] at p. 2. Defendant claims that Plaintiff represented during negotiations that the charges Defendant incurred would be at least twenty-six percent less than the charges Hinds County had previously incurred. Aff. of Petrino [22-1] at p. 2. On September 5, 2012, Bryan Teat, an employee of Plaintiff, emailed Defendant the following:

Id. at p. 9.

In September 2012, Plaintiff began filling prescriptions for Defendant and sending Defendant monthly invoices for the amounts owed. Aff. of Sanderson [18-1] at p. 2. In December 2012, Defendant paid the balance on the September and October 2012 invoices. Aff. of Petrino [22-1] at p. 4; Aff. of Sanderson [18-1] at p. 2. Plaintiff continued to supply prescription drugs to the correctional facilities and send monthly invoices to Defendant from November 2012 through July 2013. Aff. of Sanderson [18-1] at p. 2. The only other payment Plaintiff received from Defendant during this time was a single payment of $18, 000.00 in July 2013. Id. at p. 3. Plaintiff claims that as a concession to Defendant, Plaintiff agreed to credit Defendant for any invoices that exceeded $50, 000.00. Id. at pp. 2-3. Defendant asserts that Plaintiff never reduced its invoices to a $50, 000.00 cap. Aff. of Petrino [22-1] at p. 5. Plaintiff and Defendant's contractual relationship terminated on July 31, 2013. Aff. of Sanderson [18-1] at p. 3; Aff. of Petrino [22-1] at p. 6.

On August 27, 2013, Plaintiff sent Defendant a demand letter informing Defendant that it had thirty days to pay the sums owed on the unpaid invoices in full, or Plaintiff would commence suit to collect the amount due. Demand Letter [1-2]. Plaintiff included a summary of the unpaid invoices along with the demand letter. Id.

B. Procedural History

Plaintiff filed its Complaint [1] in this Court on October 2, 2013, seeking a judgment against Defendant in the amount of $404, 138.51 on the allegedly unpaid invoices pursuant to an open account contract, as well as pre-judgment and postjudgment interest and attorneys' fees. On April 15, 2014, Plaintiff filed a Motion for Summary Judgment, claiming an entitlement to judgment as a matter of law on the alleged amount due by Defendant. Plaintiff argues that it has made out a prima facie case on an open account for which there are no defenses. Defendant responds that Plaintiff has failed to meet its burden of establishing that there was a breach in the contract, because it has failed to establish the agreed price terms between the parties.

II. DISCUSSION

A. Summary Judgment Standard

Summary judgment is appropriate where the "movant shows 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). The party seeking summary judgment carries the initial burden of identifying the portions of the record which demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). An issue is genuine if the evidence is sufficient for a reasonable jury to return a verdict for the nonmoving party. Royal v. CCC & R Tres Arboles, L.L.C., 736 F.3d 396, 400 (5th Cir. 2013). A fact is "material" if its ...


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