Court Reverses Class Certification in Case Alleging Wrongful Withholding of Bonus Compensation – InPhyNet Contracting Services v. Soria — Our Chicago Class Action Attorneys Defend Businesses in Class Cases

A Florida appellate court reversed an order certifying a class of doctors claiming breach of fiduciary duty and other causes of action against their employer. InPhyNet Contracting Services v Soria, 33 So.3d 766 (Fl. Ct. App. 2010). The case began as a suit alleging breach of a covenant not to compete against one physician, leading the physician to counterclaim on behalf of a putative class with regards to a bonus compensation plan. After separating the physician’s individual claims from the class claims, the trial court certified a class. The appellate court reversed, finding that the class claims did not meet the requirements of commonality or predominance over class members’ individual claims.

InPhyNet Contracting Services (ICS) places physicians in hospitals around the state of Florida on a contractual basis. It offers incentives to physicians to work in hospital emergency rooms through a Physician Incentive Plan (PIP), which pays doctors out of a “bonus pool” associated with a hospital based on performance and similar factors. Id. at 768. ICS placed Dr. David Soria in the emergency room of Wellington Regional Medical Center, where he worked as Medical Director. The dispute between Soria and ICS began when Wellington terminated its contract with ICS and contracted with a competitor, and Soria began working for the competitor.

ICS sued Soria for breach of contract and other claims, citing a non-competition agreement that he allegedly signed. It contended that Soria had “actively engaged with the competitor” to terminate ICS’s contract and hire him. Id. at 769. Soria counterclaimed against ICS with a putative class action related to the PIP. After a series of complex procedural maneuvers, Soria filed a separate class action lawsuit regarding the PIP.

Soria alleged that ICS underpaid its physicians by falsely inflating expenses in order to reduce the available funds in the PIP bonus pools. He asserted five causes of action: breach of an implied duty of good faith, violations of the Florida Deceptive and Unfair Trade Practices Act, breach of fiduciary duty or constructive fraud, unjust enrichment, and conversion. The class of plaintiffs generally consisted of doctors who had been employed by ICS during the previous five years. After a non-evidentiary hearing, the trial court certified a class consisting of doctors both formerly and currently employed by ICS. ICS appealed the certification.

The appellate court reviewed the four basic criteria for class certification under Florida law: numerosity, commonality, typicality, and adequacy. Fla. R. Civ. P. 1.220(a). It also noted that in suits mainly seeking monetary damages, a plaintiff must show that “common questions of law or fact predominate over over any individual questions of the separate members.” Soria, 33 So.3d at 771, Fla. R. Civ. P. 1.220(b)(3). ICS challenged the trial court’s findings as to commonality and predominance, and the appellate court agreed. The court found that Soria did not plead facts explaining how ICS creates or funds the bonus pools, how it contracts with individual physicians who participate in the PIP, or how it determines the amount of payments to physicians. Without some company-wide statement of policy or practice, the court held that it could not determine that class members had common questions of law or fact, nor that any common claims predominated over any individual claims they might have.

The class action attorneys at Lubin Austermuehle have decades of experience representing consumers throughout the greater Chicago area and the Mid-West region, including Illinois Indiana, Wisconsin and Iowa. Class action lawsuits give consumers a way to assert their rights against much larger opponents, even if they lack the resources to bring a claim individually. Please contact us today online, at (630) 333-0333, or at 630-333-0333 to schedule a confidential consultation with one of our attorneys.

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