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Weiss v. Fischl

Court of Appeals of Illinois, First District, Sixth Division

August 5, 2016

BRAD A. WEISS, D.D.S., Plaintiff-Appellee,
v.
PAUL FISCHL, D.D.S., and FISCHL & WEISS DENTAL ASSOCIATES, P.C., Defendants-Appellants. PAUL FISCHL, D.D.S., and FISCHL & WEISS DENTAL ASSOCIATES, P.C., Plaintiffs-Appellants, BRAD A. WEISS, D.D.S., Defendant-Appellee.

         Appeal from the Circuit Court of Cook County, Nos. 14-CH-9511, 14-CH-10580 cons.; the Hon. Kathleen M. Pantle, Judge, presiding.

         Affirmed.

          Counsel on Appeal Kevin M. Forde and Joanna R. Driscoll, both of Forde Law Offices LLP, and Michael J. Daley and Carly V. Gibbs, both of Nisen & Elliott, LLC, both of Chicago, for appellants.

          Philip J. Zisook, Lee E. Farbman, and Anda Tatoiu, all of Deutsch, Levy & Engel, Chtrd., of Chicago, for appellee.

          Panel JUSTICE HOFFMAN delivered the judgment of the court, with opinion. Presiding Justice Rochford and Justice Hall concurred in the judgment and opinion.

          OPINION

          HOFFMAN, JUSTICE.

         ¶ 1 Paul Fischl, D.D.S., and Fischl & Weiss Dental Associates, P.C. (FWDA), appeal from an order of the circuit court confirming an arbitration award requiring them to, inter alia, pay Brad A. Weiss, D.D.S., the sum of $410, 119 for his shares of stock in FWDA and denying their application to vacate the arbitration award and from an order denying their motion for reconsideration. For the reasons that follow, we affirm.

         ¶ 2 The facts relating to the relationship between the parties are not contested. Fischl and Weiss decided to combine their respective dental practices and entered into a stock acquisition agreement (SAA) dated March 1, 2006, which provides that Weiss would purchase a 50% interest in Fischl's existing dental practice and the name of the entity would be changed to Fischl & Weiss Dental Associates, P.C. Incorporated into the SAA were, in addition to other agreements, an employment agreement between Weiss and FWDA (the Weiss employment agreement) and a stock purchase agreement; both of which appear to have been executed on March 31, 2006. In addition, section 6.3 of the SAA provides that all disagreements arising out of the agreement shall be resolved by arbitration with the American Arbitration Association (AAA).

         ¶ 3 In relevant part, the Weiss employment agreement provides that, upon the termination of Weiss's employment with FWDA and for a period of three years thereafter, he was bound to the terms of a restrictive covenant appearing in section 12 of that agreement. However, section 4(c) of the Weiss employment agreement provides that, in the event that Weiss's employment is terminated by FWDA for cause, FWDA waives its rights under the restrictive covenant contained in section 12. Section 10(b) of the Weiss employment agreement provides that, if Weiss's employment is terminated "for any reason, " FWDA is required to pay him severance pay in an amount determined pursuant to an attached exhibit. The Weiss employment agreement also contains an arbitration clause similar in wording to the one contained in the SAA.

         ¶ 4 Section 3(a) of the stock purchase agreement provides that, if Weiss terminated his employment with FWDA for any reason within 84 months after the date of the agreement, Fischl "and/or" FWDA had an option to purchase Weiss's shares of stock in FWDA at a price set forth in an exhibit to the agreement that contains specified purchase prices for each of the 84 months following the date of the agreement.

         ¶ 5 From April 2006 through October 31, 2012, Weiss and Fischl practiced dentistry as employees of FWDA. On October 31, 2012, due to irreconcilable differences that had arisen, Weiss's employment by FWDA terminated. Thereafter, Fischl and Weiss engaged dental-practice consultants to assist in the dissolution of the practice and commissioned an audit of FWDA, but each continued to see patients at FWDA's offices.

         ¶ 6 On November 28, 2012, Fischl and Weiss executed an FWDA corporate resolution that allowed Weiss to "investigate and negotiate to join, acquire or establish a dental practice that would be in violation of [section 12 of his employment agreement]." The resolution also provided that, "upon the execution of the definitive practice separation documents by Weiss and the Corporation, the Corporation shall fully and forever release Weiss" from the terms of the restrictive covenant contained in section 12 of his employment agreement, including the prohibition against the solicitation of patients for whom Weiss was the primary dentist. However, the record fails to reflect that definitive practice separation documents were ever executed by the parties.

         ¶ 7 On December 10, 2012, Fischl's attorney sent a proposed stock redemption agreement to Weiss, which provided for the surrender of his shares in FWDA and their purchase by FWDA. The proposed agreement stated that Weiss desired to sell his shares and FWDA desired to purchase them, but the agreement did not contain a purchase price. The agreement was never executed.

         ¶ 8 By December 15, 2012, Fischl and Weiss agreed to separate the FWDA patients into three groups: Fischl's patients whom he or his wife, Dr. Marie Fischl, D.D.S., would continue to treat; Weiss's patients whom he would continue to treat; and FWDA patients who would be asked to elect the dentist by whom they wished be treated. Weiss and Fischl also ...


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