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United States ex rel. Depace v. The Cooper Health Sys.

United States District Court, D. New Jersey

July 29, 2013

UNITED STATES OF AMERICA and THE STATE OF NEW JERSEY, ex rel. NICHOLAS M. DEPACE, Plaintiff,
v.
THE COOPER HEALTH SYSTEM, et al., Defendants

CARL D. POPLAR, Cherry Hill, NJ; Louis M. Barbone, JACOBS & BARBONE, ESQS., Atlantic City, NJ, Counsel for Nicholas M. Depace.

Jesse Abrams-Morley, Esq., Pro se, Philadelphia, PA.

Gaetan J. Alfano, Esq., Pro se, Philadelphia, PA.

OPINION

Page 565

HONORABLE Joseph E. Irenas, Senior United States District Judge.

Pending before the Court is Relator Nicholas DePace's Motion for Stay of Proceedings in the Court of Common Pleas of Pennsylvania (the " Motion for Stay" ). (Dkt. No. 65.) For the reasons discussed below, Relator's Motion for Stay will be denied.

I.

The only facts included herein are those relevant to the instant motion. More background can be found in the Court's

Page 566

prior Opinion in this matter, United States ex rel. DePace v. Cooper Health System , 940 F.Supp.2d 208, 2013 WL 1707952 (D.N.J. 2013).

On November 12, 2008, Relator Nicholas DePace, M.D., initiated this qui tam action against the Cooper Health System, Cooper University Hospital (collectively " Cooper" ), and Cardiovascular Associates of the Delaware Valley, P.A. (Pietragallo Br. in Opp. Ex. H., at 1.) [1] Dr. Depace's action was pursuant to the qui tam provisions of the Federal False Claims Act, 31 U.S.C. § 3730(b), and the New Jersey False Claims Act, N.J. Stat. Ann. § 2A:32C-1, et seq. ( Id. ) Throughout the qui tam litigation, Dr. DePace was represented by the law firm of Pietragallo, Gordon, Alfano, Bosick, & Raspanti, LLP (the " Pietragallo Firm" ). The representation was pursuant to a contingency fee agreement (the " Contingency Fee Agreement" ) under which Dr. DePace agreed to pay the Pietragallo Firm only if he was successful in the qui tam litigation. ( Id. Ex. G, at 3.)

The qui tam litigation settled on January 22, 2013. (Joint Stipulation of Dismissal of Relator's Compl.) Under the settlement, Dr. DePace received $2.394 million. ( Id. ) In addition, the Pietragallo Firm received $430,000 from Cooper in statutory attorneys' fees and costs under the fee shifting provisions of the Federal False Claims Act. ( Id. )

After settlement of Dr. DePace's qui tam litigation, the Pietragallo Firm attempted to recover from Dr. DePace the fees owed under the Contingency Fee Agreement. Dr. DePace refused to pay these fees on the grounds that the Contingency Fee Agreement was no longer enforceable because the Pietragallo Firm had already received payment for their legal services from Cooper under the terms of the settlement. In response, on February 19, 2013, the Pietragallo Firm filed a petition in the Philadelphia Court of Common Pleas to compel private arbitration of the fee dispute. (DePace Application for Emergent Relief to Reopen, at 1.) [2] On February 21, the Pietragallo Firm filed a motion in the Philadelphia Court of Common Please to preserve the status of disputed funds. ( Id. )

Five days later, on February 26, 2013, Dr. DePace filed in this Court an Application for Emergent Relief (the " Application" ), asking this Court to stay the state court proceedings initiated by the Pietragallo Firm, and to find that the Contingency Fee Agreement was unenforceable. (Dkt. No. 27.) At oral argument on Dr. DePace's Application, the Pietragallo Firm agreed not to move forward with the state court proceedings until ...


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