Plastic Surgeons v. Powers Acquisition Corp., et al.

Case Name:
PLASTIC SURGEON V. POWERS ACQUISITION CORPORATION
BERMUDEZ V. POWERS ACQUISITION CORPORATION
RUMALLA V. POWERS ACQUISITION CORPORATION
VATH V. POWERS ACQUISITION CORPORATION

Case Number:
RCV090730; RCV091341; RCV095478; RCV095480

Type of Case:
Plastic Surgeons Sue Internet Advertiser for Negligence – Breach of Contract/Advertising Injury

Attorneys for Plaintiff:
Eric F. Yuhl & William E. Stoner
Yuhl Stoner Carr LLP – Santa Monica

For Defendant:
Chris Arledge & Peter Afrasiabi
Turner, Green, Afrasiabi & Arledge – Newport Beach

Plaintiff's Experts:
Jennifer Ziegler – Forensic Accountant
Neal Handel, M.D., F.A.C.S. – ABPS Board Certification
Walter Gerard Sullivan, M.D., J.D. - ABPS Board Certification

Defendant's Experts:
David S. Hanson – CPA
Michael A. Peters, M.D. – ABPS Board Certification

Facts:
Plaintiffs were plastic surgeons who purchased individual pages on websites hosted by defendant Powers Acquisition Corporation (PAC). The plasticsurgery.com website was a marketing tool designed to help plastic surgeons expand their cosmetic surgery practices. A statement buried among thousands of PAC’s platicsurgery.com web pages PAC incorrectly stated that all plastic surgeons on the website were “board certified in plastic surgery.” However, the plaintiffs were only eligible for certification by the American Board of Plastic Surgery (“ABPS”) and were planning to sit for certification in November 2005. As a result of PAC’s false statement that was on the website without Plaintiffs’ knowledge, ABPS deferred the Plaintiffs from sitting for their certification exams for one year.

Plaintiff's Liability Contentions:
PAC was negligent and caused the deferral due to no fault of the doctor plaintiffs. PAC’s President wrote a letter to the ABPS absolving the doctor’s of any responsibility. Despite that, the ABPS strictly enforced its advertising guidelines and upheld the deferrals for all PAC clients.

Defense Contentions:
Doctors were comparatively at fault for not discovering the offending language and more importantly, no provable damages. Via cross-complaint PAC alleged that the ABPS interfered with PAC’s contractual relationships with their client doctors who terminated their contracts with PAC once deferred.

Plaintiff's Damages:
Plaintiffs had to spend time re-qualifying for 2006 exam. Further, Plaintiffs suffered a loss of expected increase in their aesthetic surgery revenues once ABPS certified.

Defense on Damages:
Inflated estimates of lost aesthetic surgery revenue and no records supporting time to qualify for the 2006 APBS exam. No proof of loss of patients due to lack of ABPS certification.

Settlement Discussions:
No firm offers. Through Judge Dennis Cole, IVAMS, it appeared PAC was willing to offer $50,000 for the lead plaintiff’s case. Plaintiffs indicated that offers in the $300,000 range would be seriously considered.

Result:
The parties stipulated to binding baseball arbitration with retired Judge Dennis Cole, IVAMS. Plaintiffs’ confidential baseball submission was $430,000 and PAC offered $50,000. Judge Cole entered judgment in favor of the lead plaintiff in the sum of $430,000, plus costs. By stipulation $430,000 was deemed to be the verdict for the other three plastic surgeons whose cases were pending, with a reduced cost amount. Judgment entered in favor of the four plastic surgeons totaling $1,762,700.

Court:
Rancho Cucamonga/San Bernardino County Superior Court