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UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ) ) ) ) ) ) ) Case No.: 1:09-cv-01186-RWS ) ) ) ) )

EMORY UNIVERSITY and EMORY HEALTHCARE, INC.,, Plaintiffs, v. JAMES J. MURTAGH, M.D., Defendant.

DR. JAMES J. MURTAGHS RESPONSE IN OPPOSITION TO EMORY UNIVERSITY ET AL.S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION Defendant/Respondent Dr. James J. Murtagh, by counsel, hereby respectfully submits his response in opposition to Emory University et al.s (Emorys) Motion to Dismiss for Lack of Subject Matter Jurisdiction. For all the reasons stated herein, Emorys motion to dismiss Dr. Murtaghs Motion to Vacate Arbitration Award should be denied because this Court does have diversity and federal question jurisdiction over Dr. Murtaghs Motion to Vacate Arbitration Award. In addition, Emory in its motion and supporting memorandum requests that this Court sanction Dr. Murtagh and his counsel. However, apart from such a
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request being legally and factually baseless, Emorys motion is not titled a motion for sanctions, but only a Motion to Dismiss for Lack of Subject Matter Jurisdiction. Nor does Emory offer a titled section of argument in its memorandum which speaks to Emorys sanctions request. Emorys request for sanctions should not be addressed by the Court unless and until Emory presents a separately titled and properly presented and supported motion for sanctions. However, if Emorys instant request for sanctions is to be addressed as part of its Motion to Dismiss, this request for sanctions should be denied for all the reasons stated herein. Preliminarily, it must also be noted that Emory spent a good portion of its memorandum (12 pages) stating background facts that are essentially disputed allegations going to the merits of Dr. Murtaghs Motion to Vacate Arbitration Award, facts that are not material to the instant Emory Motion to Dismiss for Lack of Subject Matter Jurisdiction, and appear to serve no purpose other than to attempt to smear Dr. Murtagh and bias the Court against him, or gain some unfair advantage. One example is Emorys assertion that Dr. Murtagh improperly removed Emorys State Court Motion to Confirm to federal court. The propriety of that removal is pending in another action pending in the Northern District, has been briefed therein, and is not before this Court at this time. Emory unnecessarily
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attaches its Motion to Remand filed in that other action as an exhibit to its motion here. There is no apparent purpose for this exhibit, which is a legal memorandum addressing several jurisdictional issues at issue here, and to which Emory makes reference for the purpose of supplementing its argument for its instant motion, see Emory Memorandum at 15, other than to creatively exceed the courts page limitations on memoranda filed in support of motions. I. FEDERAL DIVERSITY JURISDICTION IS PRESENT HERE, NOTWITHSTANDING EMORYS ASSERTION TO THE CONTRARY Emory in its Motion and its Memorandum at 14 argues that Dr. Murtagh moved to Arkansas only recently and then returned to Georgia and currently resides in Georgia and has been residing in Georgia since before this action was filed. Dr. Murtagh did move to Arkansas recently, as reflected in Dr. Murtaghs attached Declaration (this declaration was also filed in the related case also pending before the Northern District which concerns Emorys Motion to Confirm the arbitration award, which Dr. Murtagh removed from a Georgia Superior Court). See Exhibit 1, Declaration of James J. Murtagh, Jr., M.D.,(Murtagh Decl.), p.1, 2-4. However, his move to Arkansas was prior to, not years after, the litigation here in question, Dr. Murtaghs Motion to Vacate Arbitration Award. Dr. Murtagh recently moved to Arkansas, prior to Dr. Murtaghs recently
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filed Motion to Vacate the Arbitration Award, in order to obtain a job as a physician. See Exhibit 1, Murtagh Decl., p.1, 2 The fact that Dr. Murtaghs move was years after the Superior Court litigation and an arbitration were initiated is immaterial. The only issue is whether Dr. Murtaghs facts regarding his change of residence are sufficient under the substantive standards relating to diversity jurisdiction. Dr. Murtagh makes clear in his Declaration that he is temporarily back in Georgia for a temporary job and has been offered and intends to accept a new job in Louisiana, and will likely work temporarily in Mississippi as a transition to the Louisiana job. See Exhibit 1, Murtagh Decl., 10, 11. Dr. Murtagh has developed numerous ties to Arkansas and has numerous indicia of Arkansas citizen ship. See Exhibit 1, Murtagh Decl., 12, 13. Dr. Murtagh has also made clear that he has terminated his prior ties to Georgia and has no intent to reside there. See Exhibit 1, Murtagh Decl., 14. It is clear that Dr. Murtaghs return to Georgia is temporary based on the necessity of finding temporary employment while awaiting a new job to start in Louisiana, and does not reflect an intent to remain in Georgia or establish a permanent residence or a domicile there. Dr. Murtagh has presented the facts relevant to diversity jurisdiction in his Declaration, see Exhibit 1, so that both the Court and Emory may fully evaluate
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them. Dr. Murtagh has had to move to where he can find work after his dispute with Emory left him unemployed and made the physician position application process more difficult. See Exhibit 1, Murtagh Decl. p.1, 5. His new job in Arkansas was temporary although it was extended. Ultimately the position was not made permanent. Id. Dr. Murtagh has since assumed another temporary job in Georgia where he is temporarily located. Murtagh Decl., p.2, 8 However, as explained in his Declaration, Dr. Murtagh intends to pursue professional positions and residence in states other than Georgia. See Exhibit 1, Murtagh Decl., 10-14. Emory mistakenly asserts that Dr. Murtaghs Motion to Vacate is not an independent action separate from the state Court litigation in which Dr. Murtagh filed his original claims and Emory filed its counterclaims prior to Emorys Motion to Compel Arbitration being granted. However, this is clearly contrary to the plan language of the FAA which creates a new cause of action for motions to vacate. 9 U.S.C. 10; Baltin v. Alaron Trading Corp., 128 F.3d 1466, 1472 (11th Cir. 1997) (citing Franchise Tax Bd. of the State of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 27-28, (1983)). Thus, Dr. Murtaghs residence at the time of the earlier State action is immaterial. For these reasons, Dr. Murtagh believes that diversity jurisdiction exists for his motion to vacate. If diversity jurisdiction exists, this alone is sufficient to
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confer federal jurisdiction for review of Dr. Murtaghs Motion to Vacate Arbitration Award. See, e.g., Discover Bank v. Vaden, 489 F.3d 594, 598 note 2 (4th Cir. 2007); Peebles v. Merrill Lynch, 431 F.3d 1320 (11th Cir. 2005). II. FEDERAL QUESTIONS ARE PRESENT HERE WHICH PROVIDE A BASIS FOR THIS COURTS SUBJECT MATTER JURISDICTION Emory argues that there is not a single federal question to provide this Court subject matter jurisdiction over Dr. Murtaghs Motion to Vacate Arbitration Award. Contrary to Emorys assertion, there are bases for federal court subject matter jurisdiction over this action beyond diversity, including federal question jurisdiction pursuant to 28 U.S.C. 1331. Dr. Murtaghs Motion to Vacate Arbitration Award requires several federal questions to be decided. The Arbitrators several decisions, including but not limited to the final award decision, reflect both the issues that were decided by the Arbitrator and some of the issues that must now be decided in order to confirm, vacate or modify the arbitration award. See Exhibits 4-5. These decisions reflect several federal questions that must be decided on Dr. Murtaghs Motion to Vacate Arbitration Award. First, Dr. Murtagh has a federal statutory claim in the underlying arbitration. That claim is his claim of whistleblower retaliation in violation of the federal False Claims Act, brought pursuant to 31 U.S.C. 3730(h). See Exhibit 2, Dr.
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Murtaghs amended statement of his claims in the arbitration at section IV(a). Dr. Murtagh asserts that the existence of a federal claim in the underlying arbitration is sufficient for the federal court to have subject matter jurisdiction over an arbitration motion to compel, confirm, or vacate. The 11th Circuit appears to have not yet decided this issue regarding this basis of federal subject matter jurisdiction over such an FAA arbitration motion, and this issue may be one of first impression in this Circuit. Baltin v. Alaron Trading Corp., 128 F.3d 1466, 1472 (11th Cir. 1997). Emory cites Kaplan v. Dean Witter Reynolds, Inc., 896 F. Supp. 1219, 1220 (S.D. Fla. 1995), affd, 129 F.3d 615 (11th Cir. 1997) for the proposition that federal question jurisdiction cannot be found by looking beyond the petition to the underlying claims that were the subject of arbitration. Emory Memorandum at 17. The 11th Cir. Decision in Kaplan was an affirmation without a written opinion and there is therefore no basis for concluding that this decision reflected a view contrary to the explicit detailed discussion in Baltin v. Alaron Trading Corp., 128 F.3d 1466, 1472 (11th Cir. 1997). The Baltin Court decision came after the Court affirmed the district court in Kaplan and the Kaplan decision was actually cited in Baltin for another rule of law regarding the FAA not creating jurisdiction. In addition, one of the federal questions to be decided here is whether the
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Arbitrator engaged in prejudicial misconduct, as defined under the FAA as a ground for vacating an arbitration award, in defaulting Dr. Murtagh on a federal whistleblower retaliation claim as a sanction, among many other severe sanctions, notwithstanding the federal public interest purpose of the FCA and its whistleblower protection provision. This sanction was imposed by the Arbitrator on a motion by Emory grounded in two federal rules, Rule 11 and Rule 37, even though Emory apparently was operating under the misimpression that Georgia law applied to its entire motion(s) for sanctions at the time. Because the bulk of the award sought to be vacated by Dr. Murtagh was made not on any decision on the merits of Emorys original contract claims but rather based on a sanctions motion made by Emory that was of necessity, because this is an FAA arbitration, based on federal law (here Rule 11 and Rule 37), Dr. Murtaghs motion to vacate is based on and can only be resolved by an analysis of federal law. One additional federal question that must be decided to resolve Emorys Motion to Confirm the Arbitration Award is whether the State Court had the power to compel Dr. Murtagh into the arbitration that led to the award. The Supreme Court in Moses H. Cone, although deciding that state courts have the authority to grant stays of litigation before them pursuant to the FAA section 3, declined to resolve whether state courts have the power to compel arbitration pursuant section
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4 of the FAA. Baltin v. Alaron Trading Corp., 128 F.3d 1466, 1469 note 6 (11th Cir. 1997), citing Moses H. Cone Memorial Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 26, note 35 (1983). An additional federal question is whether the FAA, and the federal case law interpreting and applying the FAA, requires vacation of the award due to apparent partiality of the arbitrator. See Arbitrator Decision of March 13, 2008 denying recusal. Although the issue of whether the FAA standard is met may not per se create a federal question, this question subsumes questions regarding federal ethics rules, federal court recusal standards, and interpretation and application of Supreme Court precedent regarding the standard for recusal of arbitrators versus federal judges. See Commonwealth Coatings Corp. v. Continental Casualty Co., 393 U.S. 145 (1968). Another federal question is whether the FAA, and the federal case law interpreting and applying the FAA, requires vacation of the award due to harmful procedural error made by the Arbitrator, given the federal questions subsumed in the type of error. In this case, as one example, the Arbitrator refused to ultimately compel discovery from Emory or sanction Emory for violation of the Arbitrators discovery order, but the Arbitrator subsequently imposed severe sanctions on Dr. Murtagh for allegedly engaging in the same two types of conduct.
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An additional federal question is whether the settlement agreement and the arbitration clause it contains are unenforceable under federal FAA case law because Emory engaged in conduct that waived its right to arbitration under federal law, including attempts to litigate before the Georgia Superior Court claims and issues that were subject to the arbitration clause. Further, one or more additional federal questions are involved in deciding whether the Arbitrator knowingly failed to follow and apply federal law in denying, or refusing to decide, Murtaghs request for attorney fees and expenses for the work done by Murtaghs counsel in prevailing on Emorys (uncaptioned and non-separated) motion for sanctions brought (implicitly but necessarily) under Fed.R.Civ.Proc. Rule 11 and possibly under Rule 37. This issue does not involve the question of whether Dr. Murtagh is ultimately entitled to fees or what the proper amount of a fee award to Dr. Murtagh should be, and this is not an issue regarding Emorys fee award. This is not a tail wagging the dog scenario. Here, the heart for the arbitration award is a sanctions decision, not a decision on the merits of the claims being arbitrated, and the bulk of the monies awarded Emory under this sanctions decision by far is for fees. This issue involves questions of federal statutory procedure and whether federal law requires a judge, or arbitrator, to entertain a request for attorney fees, and exercise their discretion to decide that
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question, under the circumstances here, where the non-movant prevails in defeating a Rule 11 motion and, in part, a Rule 37 motion for sanctions. See Arbitrators Decision of February 4, 2009 at 10-12. A separate federal question relates to the Arbitrators knowing failure to apply federal case law regarding when a default, i.e. the striking of claims and defenses, is an appropriate sanction under Fed.R.Civ.Proc. Rule 37. See Arbitrators Decision of June 23, 2008. An additional federal question is whether Murtagh was denied Due Process under the Fifth and Fourteenth Amendments of the United States Constitution when he was not provided an unbiased decision maker in the State Court mandated arbitration. See Arbitrators Decision of March 13, 2008 denying Murtagh motion to recuse and to refer the recusal issue to the American Arbitration Association. And see Commonwealth Coatings Corp. v. Continental Casualty Co., 393 U.S. 145 (1968). Although there may be no Constitutional right to an unbiased decision maker in a private arbitration, Emory continues to insist that the State Court that compelled the arbitration has maintained jurisdiction over the claims arbitrated and retains jurisdiction over the entire action to this day. Although Dr. Murtagh takes a different view, to the extent Emory maintains this argument, the right to an unbiased decision maker under the 14th and 5th Amendments may still apply.
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A further federal question is whether Murtagh was denied Due Process under the Fifth and Fourteenth Amendments of the United States Constitution when the decision maker (the Arbitrator) in the State-Court-mandated arbitration knowingly applied a double standard to Murtagh and his opposing party Emory regarding when discovery would be compelled and when sanctions would be applied. See Arbitrators Decision of June 23, 2008; Arbitrators Decision of March 9, 2006 Granting Murtagh Motion to Compel; Arbitrators Decision of July 18, 2007 denying Murtagh request for sanctions. Another federal question is whether the settlement agreement and the arbitration clause it contains are unenforceable as against federal public policy pursuant to federal FAA case law. Public policy is a recognized basis for review of arbitration awards. United Paperworkers International Union v Misco, Inc., 484 US 29 (1987); Brown v Rauscher Pierce Refsnes, Inc., 994 F2d 775 (11th Cir. 1993); Prestige Ford v Ford Dealer Computer Servs., 324 F3d 391 (5th Cir 2003), cert. den., 540 U.S. 878 (2003). In this case there are questions regarding gag orders imposed via the settlement that may be against federal public policy based in whistleblower protection statutes, e.g. 31 U.S.C. 3730(h), and the First Amendment. The settlement requires Dr. Murtagh to agree to not bring any future FCA Qui Tam lawsuit based on his knowledge of events occurring prior to the date
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of the settlement. See Settlement at pages 7-10. A settlement provision should not be used to insulate a party from accountability for a violation of federal law. A settlement provision that requires a party to waive their right to bring a future FCA Qui Tam action is against public policy. United States v. Northrop Corp., 59 F.3d 953, 963-69 (9th Cir. 1995), cert. denied, 518 U.S. 1018 (1996). A review of the State Court Injunction and the two Contempt Orders make clear that Emory and apparently the State Court read the settlement contract as prohibiting Dr. Murtagh from disclosing federal crimes to federal law enforcement agencies and Congress. Dr. Murtagh has included some of the above referenced federal law based claims in his filed motion to vacate the arbitration award, and the remainder will be included in an amendment to that motion which will be filed within two weeks of this filing of the instant response memorandum by Dr. Murtagh. Dr. Murtagh respectfully requests that the Court hold its decision on Emorys Motion to Dismiss for Lack of Subject Matter Jurisdiction in abeyance for two weeks and decide that motion based on the amended version of Dr. Murtaghs Motion to Vacate Arbitration Award. Although manifest disregard of federal law is not considered a separate grounds beyond those stated in the FAA itself for vacating an arbitration award, Dr. Murtagh does assert in his Motion to Vacate Arbitration Award conduct by the
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Arbitrator that meets the FAA grounds for vacating an award, including prejudicial procedural error that equates with what used to be referred to as manifest disregard of federal law. The issue stated above regarding the Arbitrators failure to decide Dr. Murtaghs request for fees as a prevailing party under Rule 11 is one example. A second example is the Arbitrators refusal to recuse notwithstanding having formerly represented opposing parties in some of Dr. Murtaghs underlying litigation. A third example is the Arbitrators refusal to refer the recusal issue to the American Arbitration Association (AAA) for decision as required by the AAA rules which the parties settlement agreement and arbitration clause requires to be followed. Federal subject matter jurisdiction exists for review of an arbitration award and disposition of an arbitration motion that requires claims of manifest disregard for federal law to be resolved and a substantial question of federal law to be decided. Carter v. Health Net of Calif., Inc., 374 F.3d 830 (9th Cir. 2004) (citing Luong, 2004 U.S. App. LEXIS 10215, 368 F.3d at 1112). III. EMORYS REQUEST THAT DR. MURTAGH AND HIS COUNSEL BE SANCTIONED PURSUANT TO 28 U.S.C. 1927 IS NOT PROPERLY MADE AND UNFOUNDED IN FACT AND LAW AND SHOULD BE STRICKEN OR DENIED Emory argues that Dr. Murtaghs counsel should be sanctioned pursuant to 28 U.S.C. 1927. However, Emorys motion is not titled a motion for sanctions, but only a Motion to Dismiss for Lack of Subject Matter Jurisdiction. Nor does
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Emory offer a titled section of argument in its memorandum which speaks to Emorys sanctions request, and Emory does not point out in its argument section which if any of its asserted points of law and argument relate to its request for sanctions. Emory has the burden on its would be motion for sanctions, and presentation of conclusory assertions does not meet that burden. Emorys request for sanctions should not be addressed by the Court unless and until Emory presents a separately titled and properly presented and supported motion for sanctions. If Emorys instant request for sanctions is to be addressed as part of its Motion to Dismiss, this request for sanctions should be denied due to Emorys failure to offer anything more than conclusory assertions to support its sanctions request. The sum total of all of the contents of Emorys Motion to Dismiss that relate to its request for sanctions amount to three paragraphs on pages 3-4 and 12 of Emorys Memorandum which assert the following: Shortly after Emory filed its Motion to Remand with Judge Ward, Dr. Murtagh and his counsel engaged in additional judge shopping and filed this action for the sole purpose of seeking to vacate the Arbitration Award.

To make matters worse, in their zeal to establish federal court jurisdiction, Dr. Murtaghs counsel have misrepresented the applicable case law to the Court and failed to acknowledge other legal precedent that directly undermines a number of their key arguments. Because of this disregard for the judicial process, Emory is seeking not only to have this case dismissed, but also to have Dr. Murtaghs
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counsel sanctioned for filing it pursuant to 28 U.S.C. 1927. See Barnes v. Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998) (affirming award of sanctions against plaintiffs counsel under 28 U.S.C. 1927); Malautea v. Suzuki Motor Co., 987 F.2d 1536, 1544 (11th Cir. 1993) (affirming sanctions against counsel). Emory Memorandum at 3-4. Not to be deterred, on May 4, 2009, Dr. Murtagh filed his Motion to Vacate with this Court as a new lawsuit. Dr. Murtaghs filing of this second, completely duplicative lawsuit lacks any good faith basis and could not have been filed for any proper purpose. As a result, Dr Murtaghs counsel should be sanctioned for filing it. See 28 U.S.C. 1927 (Any attorney. who so multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorneys fees reasonably incurred because of such conduct). Emory Memorandum at 12. Case law interpreting 28 U.S.C. 1927 and its plain language supports the conclusion that an award of costs and fees against counsel here would not be appropriate because Dr. Murtagh has not multiplied the proceedings unreasonably and vexatiously via his Motion to Vacate Arbitration Award. Rather, Dr. Murtagh is merely following the federal statutorily provided procedure under the FAA for vacating a arbitration award. The FAA provides procedures for vacating as well as confirming arbitration awards. These procedures are addressed in two different sections of the FAA. The procedure for vacation of awards is provided for in 9 U.S.C. 10, while the
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procedure for confirming an award is provided for in 9 U.S.C. 9. The FAA provides separate causes of action for both purposes but also provides for an expedited process that requires the parties to file motions rather than complaints to initiate their action to vacate or confirm an arbitration award. See 9 U.S.C. 6; Termorio S.A. E.S.P. v Electranta S.P., 487 F3d 928 (D.C. Cir 2007), cert. den. 128 S Ct 650, 169 L Ed 2d 508 (2007). This procedure which is governed by rules controlling motions practice is different and distinct from the normal procedure of filing complaints and answers with counterclaims. Id. If the FAA specifically addresses a procedural issue or question, the procedure specified in the FAA controls. See Fed.R.Civ.P., Rule 81(a)(3); Paper, Allied-Industrial, Chem. & Energy Workers Int'l Union, Local 1-9 v S.D. Warren Co., 382 F.Supp.2d 130 (D.C. Maine 2005). If the FAA is silent as to a particular question of procedure, the federal rules governing motions practice control. Id.; Deiulemar compagnia di Navagazione S.P.A. v. M/V Allegra, 198 F.3d 473 (4th Cir. 1999), cert. den. 529 U.S. 1109(2000). Emory has not attempted to explain why Dr. Murtagh was even in error in filing a motion to vacate as an independent action pursuant to the FAA, 9 U.S.C. 10, let alone explain why the filing of such a motion was unreasonable or vexatious. Had Dr. Murtagh filed a motion to vacate within the action initiated
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by Emory via its Motion to Confirm Arbitration Award, Emory could have argued that Dr. Murtagh failed to follow the FAA mandated procedure to file the motion to vacate as a new action and that a motion filed within an existing litigation does not equate to filing an independent action as required by the FAA. See, e.g., Kruse v Sands Bros. & Co., 226 F.Supp. 2d 484 (S.D.N.Y. 2002) (Counter-petition to vacate arbitration award, in response to petition to confirm award, was not equivalent of motion to vacate award as required by 9 USCS 6.). Even if the FAA, 9 U.S.C. 6, 9, and 10, is read to allow a motion to vacate to be filed within an action initiated by a motion to confirm, Dr. Murtaghs counsel were not unreasonable in protecting Dr. Murtaghs position by taking the cautious approach and following the procedure explicitly provided in the statutory language of the FAA as recognized in decisions of this Court. See, e.g., O.R. Sec. v Professional Planning Assocs., 857 F2d 742 (11th Cir. 1988) (proper procedure is for party seeking to vacate arbitration award to file motion to vacate in District Court) ; Interior Finish Contractors Asso. v Drywall Finishers Local Union No. 1955, 625 F.Supp. 1233 (E.D. Pa. 1985) (Rule 81(a)(3), read together with 9 USCS 6 and 10 and Federal Rules of Civil Procedure, Rule 7(b)(1), require that party must file motion in order to apply to court to set aside arbitration.). Emory has not cited to or quoted any language in the FAA which would
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require a motion to vacate to be filed within an action initiated by a prior filed motion to confirm. Nor has Emory cited to any case that requires such a procedure. Consequently, there is no basis justifying Emorys request for sanctions against counsel for having taken the statutorily prescribed course to protect Dr. Murtaghs rights. Emorys assertion that Dr. Murtagh filed this action for the sole purpose of seeking to vacate the Arbitration Award, and Dr. Murtaghs filing of this second, completely duplicative lawsuit lacks any good faith basis and could not have been filed for any proper purpose, Emory Memorandum at 3-4, is thus hardly an indictment of misconduct when the FAA requires such the filing of such an independent action captioned as a motion in order to achieve this very purpose of vacating an arbitration award. Notably absent in Emorys motion is any quotations from the language of the applicable FAA provisions and any discussion of FAA case law in which the courts have articulated the required procedures. Thus, Emory utterly fails to meet its burden of showing that Dr. Murtaghs counsels approach here is sanctionable under 28 U.S.C. 1927. It should be noted that Emorys reference to Dr. Murtagh having filed this second lawsuit should not be read to assert, and certainly not to prove, that Dr. Murtagh filed both the Motion to Confirm (which Emory filed) and the Motion to Vacate (which Dr. Murtagh filed).
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Emory filed the Motion to Confirm in State Court, which Emory action Dr. Murtagh then removed to federal court. Further, to the extent Emory asserts that Dr. Murtaghs counsel should be sanctioned for choosing a federal forum for the motion to vacate, i.e. for allegedly judge shopping, it is clear that Dr. Murtaghs asserted bases for federal subject matter jurisdiction are not frivolous, as explained herein. Absent such a complete lack of any colorable basis for federal jurisdiction, it is hard to understand how Emory could now claim that a filing in the United States District Court for the Northern District of Georgia of a motion to vacate or confirm regarding the arbitration award in this matter is sanctionable given the plain language of the arbitration clause in the parties settlement agreement which explicitly provides for just such a filing. Dr. Murtagh, in filing his motion to vacate in this Court (and removing Emorys Motion to Confirm to this Court) was honoring the parties intent and agreement reflected in their settlement and arbitration clause in which the only court mentioned as an agreed forum for post award review was this Court. See Exhibit 3, Settlement arbitration clause, 13. Even if Dr. Murtagh were found to be incorrect in his view of the law and procedure regarding federal subject matter jurisdiction and motions to vacate arbitration awards, and it still appears to his counsel based on the law and
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argument presented supra that Dr. Murtagh is correct (Emorys arguments notwithstanding), at minimum Dr. Murtagh has articulated a good faith basis for his actions in filing his motion to vacate in this Court and asserting that this Court has subject matter jurisdiction. Dr. Murtaghs action in filing his Motion to Vacate is therefore not subject to sanction under 28 U.S.C. 1927. Emory also asserts that Dr. Murtaghs counsel have misrepresented the applicable case law to the Court and failed to acknowledge other legal precedent that directly undermines a number of their key arguments. However, Emory never finds time in its memorandum to specify which case law relied on by Dr. Murtagh has allegedly been misrepresented. Likewise, Emory never finds time in its memorandum to specify which legal precedent Dr. Murtagh fails to acknowledge that allegedly undermines Dr. Murtaghs arguments. Sanctions may not be awarded on the basis of such global conclusory assertions which are impossible to rebut because they vague and non-specific. Emory cites to two cases in an effort to shore up its already fatally flawed sanctions argument: Barnes v. Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998) and Malautea v. Suzuki Motor Co., 987 F.2d 1536, 1544 (11th Cir. 1993). Emory does not discuss either case but simply asserts parenthetically that in Barnes the court affirmed an award of sanctions against plaintiffs counsel under 28 U.S.C. 1927,
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and in Malautea the court affirmed sanctions against counsel. In Barnes the 11th Circuit, which was a case regarding the power of the Court to issue sanctions under its inherent power, not under 28 U.S.C. 1927, the Circuit made clear that a finding of sanctionable conduct requires a finding of bad faith. The key to unlocking a court's inherent power is a finding of bad faith. See In re Mroz, 65 F.3d 1567, 1575 (11th Cir.1995). "A finding of bad faith is warranted where an attorney knowingly or recklessly raises a frivolous argument, or argues a meritorious claim for the purpose of harassing an opponent. A party also demonstrates bad faith by delaying or disrupting the litigation or hampering enforcement of a court order." Barnes v. Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998). As explained supra, Dr. Murtagh and his counsel had a clear legal basis for filing his Motion to Vacate, and for filing this motion as an action separate from Emorys Motion to Confirm which Dr. Murtagh had removed. Emory has not proven any bad faith on the part of Dr. Murtagh or his counsel. Likewise, in Malautea , a case that did involve 28 U.S.C. 1927 sanctions, the requirement for a showing of bad faith by counsel was also stated. This case involved a pattern of misconduct in discovery by counsel including a willful coverup to conceal material evidence sought by the opposing party via discovery, which conduct necessitated issuance of three orders by the court. Neither of these two cases cited by Emory involved arbitration motions or federal
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court jurisdictional issues and provide no basis for issuance of sanctions against Dr. Murtaghs counsel here. IV. FEDERAL RULE 11 SHOULD NOT BE CONSIDERED AS AN ALTERNATIVE BASIS FOR EMORYS REQUESTS FOR SANCTIONS BECAUSE, APART FROM BEING UNFOUNDED IN FACT AND LAW, EMORYS REQUEST WAS NOT MADE IN COMPLIANCE WITH RULE 11 Emory does not assert that Dr. Murtagh and his counsel have violated Fed.R.Civ.Proc. Rule 11, and Rule 11 should not be considered by the Court as an alternate basis for an award of sanctions. Apart from the lack of any basis in fact or other law for Emorys request for such sanctions, even if Dr. Murtagh were found to be incorrect in his view of the applicable law and procedure regarding motions to vacate arbitration awards, at minimum Dr. Murtagh has articulated a good faith basis for his actions as noted supra. Dr. Murtaghs motion to vacate is therefore non-frivolous and not subject to sanction under Rule 11. In any case, Emory has not served Dr. Murtagh with a safe harbor letter, nor has Emory captioned its Motion as a Rule 11 motion, and Emory has not separated out its Rule 11 motion from other motions, all of which steps are required statutory prerequisites to filing a Rule 11 request for sanctions. Fed.R.Civ.Proc., Rule 11(c)(1)(A); N. Philadelphia Health Systems v. District 1199C, 2002 U.S. Dist. LEXIS 22267; Perpetual Securities v. Julie Tang, 290 F.3d 132, 141-42 (2d Cir.
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2002). Thus, Rule 11 should not be seen as an alternative basis for Emorys sanctions request. V. EMORY MAKES SEVERAL IMMATERIAL AS WELL AS FALSE OR MISLEADING ASSERTIONS IN ITS MEMORANDUM Emory spent a good portion of its memorandum asserting background facts that are essentially disputed allegations going to the merits of Dr. Murtaghs Motion to Vacate the Arbitration Award, facts that are not material to the instant Emory Motion to Dismiss. Such assertions appear to serve no purpose other than to attempt to smear Dr. Murtagh and bias the Court against him. See Emory Memorandum at 1-12. These 12 pages of immaterial assertions should be stricken except for the few that may relate to jurisdiction issues. In the process of making its 12 pages of largely immaterial and disputed assertions of fact, Emory also managed to make several false or misleading statements. These false or misleading statements are not addressed at this time because Dr. Murtagh intends to follow the proper procedure under Rule 11. Dr. Murtagh makes no request for sanctions at this time and reserves any assertions regarding whether Emorys conduct transgresses Rule 11 until the proper procedures have been completed. CONCLUSION AND RELIEF REQUESTED For all the foregoing reasons, Emorys Motion to Dismiss should be denied.
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Respectfully submitted, s/ J. Clayton Culotta J. CLAYTON CULOTTA Culotta & Culotta LLP Jefferson Hall 432 E. Court Avenue Jeffersonville, Indiana 47130 Telephone No. (812) 288-5141 Facsimile No. (812) 288-8305 1615 L Street, NW Suite 1350 Washington, D.C. 20036 s/ Mick G. Harrison The Caldwell Center 323 S. Walnut Street Bloomington, IN 47401 Telephone and Fax No. (812) 323-7274 Cell phone No. (812) 361-6220 E-mail: mickharrisonesq@earthlink.net s/ Glenn L. Goodhart, Esq., GA Bar # 300540 6065 ROSWELL RD NE STE 410 SANDY SPRINGS, GA 30328 TEL. 404-255-3282 FAX 404-255-3524 Attorneys for Plaintiff, James J. Murtagh, M.D.

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CERTIFICATE OF COMPLIANCE WITH L.R. 5.1B I HEREBY CERTIFY that the foregoing motion was prepared in Times New Roman, 14-point font, as approved by Local Rule 5.1B. s/ Mick G. Harrison Mick Harrison, Esq. Pro Hac Vice

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CERTIFICATE OF SERVICE This is to certify that I have served a copy of the foregoing MEMORANDUM IN OPPOSITION TO EMORYS MOTION TO DISMISS upon the following parties by filing the document via the Courts electronic filing system: Todd D. Wozniak Lindsey Camp Edelmann GREENBERG TRAURIG LLP 3920 Northside Parkway, Suite 400 Atlanta, GA 30327 wozniakt@gtlaw.com Theodore B. Eichelberger Alton & Bird LLP One Atlantic Center 1201 West Peachtree Street Atlanta, GA 30309-3424 teichelberger@alston.com

/s/ Glenn L. Goodhart Glenn L. Goodhart, Esq.

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