United States District Court, N.D. Ohio, Eastern Division
LOUIS J. MALCMACHER, DDS, et al., Plaintiffs,
JAMES T. JESSE, DDS Defendant.
C. NUGENT United States District Judge
matter is before the Court on the Second Motion for Judgment
on the Pleadings filed by Plaintiffs, American Academy of
Facial Esthetics, LLC (“AAFE”) and Louis J.
Malcmacher, DDS. (Docket #21.) Plaintiffs assert they are
entitled to judgment as a matter of law on all three claims
raised by Defendant, James T. Jesse, in his Amended
and Procedural Background
2011 through 2014, Dr. Jesse contracted with AAFE to present
Botox and dermal filler workshops in Ohio and California on
behalf of AAFE. Dr. Malcmacher was President of AAFE. In July
2013, the California Dental Board notified Dr. Malcmacher and
Dr. Jesse of a dispute (the “Dental Board
Dispute”) involving events that occurred during a 2012
AAFE workshop for which Dr. Jesse was an instructor and
during which it was alleged that live injections were
performed on a non-patient, in violation of California
regulations. Dr. Malcmacher and Dr. Jesse were represented by
the same Ohio and California counsel in the Dental Board
Dispute, which was resolved through a Citation Order.
9, 2015, Dr. Jesse filed an eight count Complaint in
California State Court, James T. Jesse, D.D.S. v. Louis
J. Malcmacher, D.D.S, et al., Case No. CIVDS1509595,
Superior Court of the State of California, County of San
Bernardino, Central District, alleging Intentional
Misrepresentation, Concealment, False Promise, Negligent
Misrepresentation, Breach of Contract, Breach of Covenant of
Good Faith and Fair Dealing, Elder Abuse and Negligence,
against Dr. Malcmacher and AAFE. Dr. Jesse alleged that he
continued to perform Botox injections during workshops based
on misrepresentations made by Dr. Malcmacher and AAFE that
the injections were not illegal, subjecting him to Dental
Board scrutiny and resulting in out-of-pocket expenses for
his defense which Dr. Malcmacher and AAFE promised to
compensate him for but never did. Dr. Jesse alleged that Dr.
Malcmacher and AAFE took financial advantage of him by
obtaining his services with the intent to defraud. Dr.
Malcmacher and AAFE removed the case to the United States
District Court for the Central District of California, Case
No. 5:15 CV 1677, and filed a Counterclaim for Breach of
California District Court granted summary judgment in favor
of Dr. Jesse on Dr. Malcmacher and AAFE's Breach of
Contract Counterclaim, finding that the contract did not
explicitly prohibit live injections. The California Court
granted Dr. Malcmacher and AAFE summary judgment on Dr.
Jesse's Intentional Misrepresentation, Negligent
Misrepresentation, False Promise, Elder Abuse and Negligence
claims. The remainder of the case - Dr. Jesse's claims
for Fraudulent Concealment, Breach of Contract and Breach of
Implied Covenant of good Faith and Fair Dealing - proceeded
to trial and the jury entered a verdict in favor of Dr.
Malcmacher and AAFE on all claims.
Dr. Malcmacher and AAFE, initially filed the instant action
in the Cuyahoga County Court of Common Pleas, Case No. CV 17
877466, on March 16, 2017. On April 17, 2017, Dr. Jesse filed
a Notice of Removal with this Court pursuant to this
Court's diversity jurisdiction. Plaintiffs assert claims
against Dr. Jesse for Abuse of Process and Malicious
Prosecution, alleging that the California lawsuit filed by
Dr. Jesse was filed “to intentionally drive-up Dr.
Malcmacher's and AAFE's costs and to force an
unreasonable settlement” and filed without probable
cause and with malice. On July 15, 2017, Dr. Jesse filed his
Answer to Complaint and Amended Counterclaim, setting forth
causes of action for Abuse of Process, Malicious Prosecution
and Tortious Interference with Business Relationships.
August 9, 2017, Plaintiffs filed their Second Motion for
Judgment on the Pleadings. (Docket #21.) Plaintiffs argue
that Dr. Jesse's tortious interference claim is barred by
the doctrine of res judicata, given that the
California Litigation addressed the Dental Board Dispute, Dr.
Jesse's contractual relationship with AAFE, and Dr.
Jesse's services performed on behalf of AAFE; that the
California litigation resulted in a jury verdict favorable to
Plaintiffs; and, that Dr. Jesse's tortious interference
claim could have been litigated in the California lawsuit.
Further, Plaintiffs argue that Dr. Jesse has failed to
sufficiently allege claims for abuse of process or malicious
prosecution. On October 10, 2017, Dr. Jesse filed his
Memorandum in Opposition. (Docket #27.) Dr. Jesse argues that
“Plaintiffs' Complaint filed in this federal court
is tantamount to harassment and is the basis for Jesse's
counts for Abuse of Process and Malicious Prosecution.”
(Docket #27, p. 2.) Further, Dr. Jesse argues that his
intentional interference claim “is not solely based on
the mere existence of the California Dental Board's
investigation, ” and that the “availability of
information to his past, current and prospective patients,
from a simple background search of California Dental Board
Disciplinary Actions and court dockets has caused and will
continue to cause him to sustain damages.”
standard of review used by a district court to rule on a
motion for judgment on the pleadings is the same as the
standard used to rule on Rule 12(b)(6) motions. See
Grindstaff v. Green, 133 F.3d 416, 421 (6th Cir. Tenn.
1998). A motion to dismiss under Federal Rule of Civil
Procedure 12(b)(6) allows a defendant to test the legal
sufficiency of a complaint without being subject to
discovery. See Yuhasz v. Brush Wellman, Inc., 341
F.3d 559, 566 (6th Cir. Ohio 2003). In evaluating
a motion to dismiss, the court must construe the complaint in
the light most favorable to the plaintiff, accept its factual
allegations as true, and draw reasonable inferences in
favorable of the plaintiff. See Directv, Inc. v.
Treesh, 487 F.3d 471, 476 (6th Cir. Ky.
2007). The court will not, however, accept conclusions of law
or unwarranted inferences cast in the form of factual
allegations. See Gregory v. Shelby County, 220 F.3d
433, 446 (6th Cir. Tenn. 2000). In order to
survive a motion to dismiss, a complaint must provide the
grounds of the entitlement to relief, which requires more
than labels and conclusions, and a formulaic recitation of
the elements of a cause of action. See Bell Atl. Corp. v.
Twombly, 127 S.Ct. 1955, 1964-65 (2007). That is,
“[f]actual allegations must be enough to raise a right
to relief above the speculative level, on the assumption that
all the allegations in the complaint are true (even if
doubtful in fact).” Id. (internal citation
omitted); see Association of Cleveland Fire Fighters v.
City of Cleveland, No. 06-3823, 2007 WL 2768285, at *2
(6th Cir. Ohio Sept. 25, 2007) (recognizing that
the Supreme Court “disavowed the oft-quoted Rule
12(b)(6) standard of Conley v. Gibson, 355 U.S. 41,
45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)”). Accordingly,
the claims set forth in a complaint must be plausible, rather
than conceivable. See Twombly, 127 S.Ct. at 1974.
motion brought under Rule 12(b)(6), the court's inquiry
is limited to the content of the complaint, although matters
of public record, orders, items appearing in the record of
the case, and exhibits attached to the complaint may also be
taken into account. See Amini v. Oberlin College,
259 F.3d 493, 502 (6th Cir. Ohio 2001). It is with
this standard in mind that the instant Motion must be
I. Intentional Interference with Business
doctrine of res judicata encompasses the two related
concepts of claim preclusion and issue preclusion.
Anderson v. City of Blue Ash,798 F.3d 338, 350
(6th Cir. Ohio 2015). “‘Claim
preclusion prevents subsequent actions, by the same parties
or their privies, based on any claim arising out of a
transaction that was the subject matter of a previous
action.'” Id. (quoting O'Nesti v.
DeBartolo Realty Corp., 113 Ohio St.3d 59, 2007 Ohio
1102, 862 N.E.2d 803, 806 (Ohio 2007)). Claim preclusion also
bars subsequent actions whose claims "could have been
litigated in the previous suit." Id. The
purpose of this doctrine is to promote the finality of
judgments and thereby increase certainty, discourage multiple
litigation, and conserve judicial resources. Westwood
Chemical Co. v. Kulick, 656 F.2d 1224, 1229 (6th Cir.
Ohio 1981). By contrast, issue preclusion, or collateral
estoppel, prevents the “‘relitigation of any ...