Case Studies

Defending Ambulatory Surgery Center Against Lawsuit by Former Physician-Members

Ambulatory surgery centers (ASCs) have become a large and growing feature of the health care industry. (ASCs offer same-day surgical care, including diagnostic and preventive procedures, and can provide a more convenient and lower-cost alternative to hospital-based outpatient procedures.) ASC sale/acquisition activity has intensified over the past few years.

Epstein Becker Green has substantial experience representing ASCs in sales and acquisitions—and defending ASCs when their corporate transactions and decision-making are challenged. For example, in November 2018, Epstein Becker Green obtained a significant victory for an ASC client located on the East Coast of the United States. From the fall of 2017 through the spring of 2018, we represented our client in a transaction involving the sale of a controlling membership interest to a company that develops and operates ASCs and surgical hospitals nationwide (“Purchaser”). During the diligence phase of the transaction, five former physician-members, who had departed our client’s practice months before, asserted that they had been improperly forced out and sought a portion of the proceeds of the sale to the Purchaser. Those individuals then filed an action with the American Arbitration Association, asserting claims of breach of fiduciary duty, constructive fraud, negligence, and violation of the relevant state’s Blue Sky Law. The allegations asserted significant contentious issues regarding the ramifications of non-competition agreements between the parties. The claimants sought the return of their equity in our client, the value of their equity had they not departed our client, and other compensatory damages, totaling several million dollars.

Epstein Becker Green vigorously defended the lawsuit, which went to a five-day hearing only 90 days after the Statement of Claim was filed. The arbitrator’s lengthy decision resoundingly found in favor of our client on all counts. The arbitration clause in the parties’ agreement contained a “prevailing party’s provision,” enabling our client to seek repayment of its attorneys’ fees and costs from the claimants.

Frank C. Morris, Jr., and Nathaniel M. Glasser represented our client throughout the arbitration, with assistance from E. John Steren, Kathleen M. Williams, and Jonathan Hoerner.

Epstein Becker Green Represents Health Insurer in Sale of Its Nonmedical Home Care and Private Duty Services Subsidiary

Epstein Becker Green represented Fallon Health in connection with the sale of its subsidiary, Home Staff, to Associated Home Care, an affiliate of Amedisys, for an undisclosed amount. Home Staff provides nonmedical home care and private duty services through home health aides who do not hold professional licenses. Amedisys, one of the nation’s leading home health care and hospice companies, is looking to the Home Staff acquisition to enhance Amedisys’s presence and staffing capabilities in the Massachusetts area.

Epstein Becker Green advised Fallon Health over a fairly lengthy period—stretching from the auction process to closing—on a wide ranges of issues, including the definitive purchase agreement, governance matters, and the execution of the closing itself.

The Epstein Becker Green transaction team consisted of Mark Mosby, Kathy Lofft, Carly Hoinacki, John Barry, Lindsay Borgeson, Michelle Capezza, Jeff Kramer, Cassandra Labbees, Marc Mandelman, Conor Murphy, Steve Ruskin, Susan Gross Sholinsky, Trish Wagner, Pat Wheeler, and Ali Wolf. The Epstein Becker Green investigation team consisted of George Breen, Stuart Gerson, Jon Hoerner, Tom Hutchinson, and Theresa Thompson.