In the many lawsuits filed by chiropractors against Practice Management Associates (PMA), one of the most important issues is that of venue: Where will the trial be held? Whether Dr. Peter Fernandez and his attorneys have to appear in courtrooms all across the country or the local DC has to take time out of his practice to appear in a Pinellas County Court in Florida is a very important decision.
On January 17, 1992, Superior Court Justice Charles J. Hely denied PMA's motion to dismiss the lawsuit brought against them by Attorney Robert Cohan representing a former PMA client who resided in Massachusetts. PMA had asserted that the venue clause of their contract should prevail:
"18. In the event of legal proceedings, the parties agree that the exclusive venue shall rest in Pinellas County, Florida, except for those matters which are exclusively reserved to federal court jurisdiction in which case the exclusive venue shall rest in the county in which the federal court having jurisdiction over Pinellas County sits. ... The parties agree that the laws of the state of Florida shall govern this contract and any interpretations or construction thereof."
But in denying the attempted change of venue, Judge Hely stated:
"Although the plaintiff originated the calls and PMA received them in Florida, PMA provided the advice for the plaintiff's business in Massachusetts, and it was received by the plaintiff in Massachusetts. This is some evidence of transacting business in Massachusetts, regardless of who originated the call. Consulting by telephone was one of the primary aspects of the practice management consulting contract between the parties. "Perhaps the most significant evidence of transacting business in Massachusetts is that PMA bought a 10 percent interest in the weekly gross income of the plaintiff's practice. This 10 percent interest in the income of a chiropractic practice in Massachusetts together with the other evidence in the plaintiff's affidavit is sufficient to show that PMA was transacting business in the Commonwealth."
Judge Hely went on to make several additional statements which revealed how he viewed the case as it had been presented thus far:
"In paragraph 18 of the contract between the parties, they (PMA) agreed to a forum selection clause, agreeing that any legal proceedings would be brought in Pinellas County, Florida or in the Federal Court with jurisdiction over Pinellas County, Florida. The court should not lightly override either a forum selection clause or any other provision in a business contract arrived at between two adults for business purposes. The plaintiff's affidavit does not establish facts which would amount to fraud or duress as a basis for overriding the forum selection provision in their contract. "The forum selection clause, however, must be considered as one provision in the overall contract whereby PMA would provide consultation and management advice and assistance to the plaintiff in the operation of his chiropractic office. It is clear from the plaintiff's affidavit, including Exhibit B-D, that an important part of PMA's purpose in this and similar contracts is to increase contract revenue by advising their clients to commit fraud and other illegal and unethical practices.
"The plaintiff's affidavit has identified Exhibit B as excerpts from the practice advice materials provided by PMA in performance of this contract. There are several suggestions to engage in fraudulent or unethical practices in these materials."
In addition, Judge Hely had this to say:
"Courts will not enforce either illegal contracts or contracts for the performance of acts or practices which are illegal or against public policy. Green v. Richmond, 369 Mass. 47 (1975); Reuter v. Ballard, 267 Mass. 557, 563 (1929). It is apparent from the plaintiff's affidavit and PMA's practice advice materials that PMA entered the contract with the intent to maximize its earnings by advising the plaintiff to engage in fraudulent and unethical practices. It is PMA who is seeking the shelter of the forum selection clause. The court will not lend its aid to PMA's fraudulent contract purpose by enforcing this clause.
Now the PMA attorneys will have to travel to Massachusetts or hire local outside counsel. Should this trend continue, the cost of litigation for PMA would increase substantially.
