Barnia v. Kaur

646 F.Supp.3d 154

Shashi BARNIA, DDS, and AAA Dental PC, Plaintiffs, v. Amandeep KAUR, D.D.S., Tejpreet Singh, M.D.,and Amandeep Kaur, D.D.S. P.C., Defendants.

Civil Action No. 1:22-CV-10216-AK

United States District Court, D. Massachusetts

Signed December 5, 2022

David H. Rich, Evan A. Johnson, Todd & Weld, LLP, Boston, MA, for Plaintiffs.

Gary R. Greenberg, Joseph P. Davis, III, Kelly M. Pesce, Greenberg Traurig, LLP, Boston, MA, for Defendants.

MEMORANDUM AND ORDER

A. KELLEY, District Judge

Plaintiffs Shashi Barnia, DDS ("Dr. Barnia"), and his professional corporation, AAA Dental PC, bring this action against Amandeep Kaur, DDS ("Dr. Kaur"), Tejpreet Singh, MD ("Dr. Singh"), and Dr. Kaur's professional corporation, Amandeep Kaur DDS, PC. Dr. Barnia alleges that the defendants fraudulently enticed him into an employment agreement and then denied him the payment of a nondiscretionary annual profit-based bonus. He further alleges that defendants published false and defamatory statements about him and inflicted emotional distress by threatening him with deportation and criminal sanction if he did not agree to their financial demands. Additionally, Dr. Barnia seeks to enforce the sale of two dental practices. He alleges that defendants used unfair and deceptive practices when they breached their contractual obligations to sell the practices to him at a previously agreed upon price. The defendants have filed a motion to dismiss Plaintiff's Amended Complaint for failure to state a claim. [Dkt. 13].¹ Dr. Barnia opposes the motion.

For the following reasons, the defendants' motion to dismiss for failure to state a claim [Dkt. 13] is GRANTED IN PART and DENIED IN PART. The motion as to Counts I, III, IV, VI, V, VII, VIII, IX, and X is DENIED. The motion as to Counts II (Wage Act) is GRANTED.

I. Background

The following facts are drawn from the Complaint [Dkt. 12] and taken as true for the purposes of a motion to dismiss for failure to state a claim. García-Catalán v. United States, 734 F.3d 100, 103 (1st Cir. 2013); see also Fed. R. Civ. P. 12(b)(6).

A. Dr. Barnia's Employment with Defendants and Bonus

Dr. Barnia was operating a dental practice in Texas when, around August 13, 2013, the defendants, who are extended family members, came and visited his family after Dr. Barnia experienced a personal tragedy. [Dkt. 12 "Am. Cmplt." at ¶ 11]. During the visit, Dr. Kaur suggested Dr. Barnia move to Massachusetts, the state where he began his dental career, and assist her in launching a new dental practice. [Id. at ¶¶ 9, 12]. Based in New York, Dr. Kaur was unable to move and launch the new practice herself. [Id. at ¶ 12]. Dr. Barnia was persuaded by Dr. Kaur's promise that in addition to his salary, he would receive an annual management bonus that was equivalent to 50% of the profits the practice made. [Id. at ¶ 13]. Around February 2014, Dr. Barnia moved back to Massachusetts to begin the work to set up the dental practice. [Id. at ¶ 14].

After his arrival, Dr. Barnia discussed with Dr. Kaur the 50% nondiscretionary profits-based management bonus ("management bonus") which was owed and payable to Dr. Barnia at the end of each calendar year and would be determined by defendants based on their accounting. [Id. at ¶ 15]. Dr. Barnia's work visa did not permit him to have an ownership interest in the same business in which he was employed. [Id. at ¶ 16]. As a result, Dr. Kaur advised Dr. Barnia that the management bonus should be excluded from the written contract because U.S. Citizenship and Immigration Services could misinterpret its profit-sharing aspect as an ownership interest if it were in the employment contract. [Id.]. According to Dr. Barnia, Dr. Kaur reiterated the promise of the management bonus and based on their family relationship, Dr. Barnia trusted her and agreed to exclude it from his employment agreement. [Id. at ¶ 17].

Dr. Barnia then identified the site of the new practice and prepared its launch by ordering the relevant supplies, hiring staff, and more. [Id. at ¶¶ 18-20]. The new dental practice, Webster Smiles, opened around September 2014, and Dr. Barnia began to manage its day-to-day operations. [Id. at ¶ 21]. The practice's accounting was handled in New York by Dr. Kaur's accountant. [Id. at ¶ 22]. While Dr. Barnia did have access to the corporate bank account information, which he claims was insufficient to accurately calculate the profits of the dental practices, he did not have access to the practice's bank accounts or bank statements. [Id.].

Webster Smiles quickly became financially successful and was able to pay off a $450,000 loan, which Dr. Kaur had obtained to launch the practice, exclusively using its profits. [Id. at ¶ 23]. Dr. Barnia claims that when he raised the practice's profitability and his management bonus, Dr. Kaur would tell him that while the practice was bringing in revenue, it was not yet profitable. [Id.].

In 2017, Dr. Kaur asked Dr. Barnia to open a second dental practice and again promised the same management bonus. [Id. at ¶ 24]. Dr. Barnia again scouted and selected the location, recruited staff, managed construction, and took care of other matters in order to launch the practice. [Id. at ¶ 25]. The second practice was opened under Dr. Amandeep Kaur DDS, P.C. and was called Palmer Dental. [Id. at ¶ 24]. Dr. Barnia alleges that he was the sole decision-maker for both dental practices, and that he had the defendants' express authorization to be the signatory on all business matters including credentialing documents, leases, and insurance submissions. [Id. at ¶ 26]. The defendants regularly mailed Dr. Barnia signed checks for him to use to pay bills for the practices. [Id. at ¶ 27]. Throughout their business relationship, Dr. Barnia would sign documents on Dr. Kaur's behalf and then send them to her. [Id. at ¶ 37]. Defendants acknowledged this and did not object to the practice. [Id.]. Dr. Kaur would receive, approve, and rely on these documents. [Id. at ¶ 47].

At some point during the COVID-19 pandemic, Dr. Barnia gained access to the dental practices' bank accounts. [Id. at ¶ 22]. By 2021, the dental practices were producing approximately $2.5 million in annual revenue. [Id. at ¶ 28]. While he was not able to calculate the business profits, Dr. Barnia began to believe that he was being denied the management bonus he was promised. [Id.]. He requested that Dr. Kaur provide two years of the practices' tax filings, and Dr. Kaur declined to do so. [Id.]. Dr. Barnia never received a management bonus, and an accounting of the practice's profits was never provided to him. [Id.]. Dr. Barnia began to believe that Dr. Kaur would never give the management bonus he believed he was owed and that instead that the defendants were siphoning the practices profits to pay for personal expenses. [Id. at ¶ 29].

B. Attempted Sale of the Dental Practices

In July 2021, Dr. Barnia again raised the issue of the unpaid management bonus and told defendants that he was considering either leaving the practices or purchasing them from defendants. [Id. at ¶ 30]. Defendants indicated that they were willing to sell the practices and the parties began discussing terms of a transfer. [Id. at ¶ 31]. The parties agreed upon a price of $700,000 around July 2021. [Id. at ¶¶ 31-32]. Dr. Barnia formed a corporation, AAA Dental PC, which would take title of the assets of both dental practices. [Id. at ¶ 32]. The change of ownership was set for August 16, 2021, with all income prior to that date going to the defendants and all income subsequent going to Dr. Barnia's business account. [Id.].

Over the next few months, the parties performed pursuant to the agreement. With the defendants' knowledge, AAA Dental PC began paying the dental practices' expenses and receiving revenue and proceeds from insurance companies. [Id. at ¶ 33]. Around September 2021, Dr. Barnia paid a $30,000 bill for the defendants from an AAA Dental PC account after Dr. Singh's requested help covering certain bills. [Id.]. The defendants would also regularly discuss closing their financial accounts with Dr. Barnia. [Id.]. In phone and email conversations about the sale, the parties would discuss the change in ownership. [Id. at ¶ 35]. On or around September 2021, Dr. Barnia forwarded to defendants the change of lease documents for Webster Smiles, which Dr. Singh replied to by asking to update the respective names. [Id.]. Dr. Barnia claims he would not have incurred these expenses, or continued working at the dental practices, had the sale not been in process. [Id. at ¶ 34].

When Delta Dental requested a written purchase and sale agreement before they would input the change of ownership into their insurance credentialing payment systems, Dr. Barnia contacted the defendants to create such a document. [Id. at ¶ 39]. Dr. Barnia found a simple purchase and sale agreement online, added relevant details including the $700,000 purchase price, and sent it to the defendants. [Id.]. Dr. Kaur stated that the agreement was too simple and requested several revisions. [Id. at ¶ 40]. After Dr. Barnia sent the updated revisions, Dr. Singh in a voicemail acknowledged that the price was acceptable but claimed he wanted to review the non-monetary terms with his attorney or accountant. [Id.].

Dr. Singh then sought to change the sale price to $988,500. [Id. at ¶ 41]. On a Facetime call on October 27, 2021, Dr. Singh again insisted that Dr. Barnia pay the $988,500. [Id. at ¶ 42]. According to Dr. Barnia, when he refused because the previous price was $700,000, Dr. Singh threated Dr. Barnia. [Id.]. He reminded Dr. Barnia that while he was a U.S. citizen, Dr. Barnia was not. [Id.]. Dr. Singh threatened that Dr. Barnia would suffer immigration consequences if he did not pay the new higher price. [Id.]. Dr. Singh further told Dr. Barnia that if he did not give into his demands, that Dr. Singh and Dr. Kaur would go to the police and raise baseless, fabricated, or invented charges...