Epstein Becker Green Negotiates Divestiture of Fleet Management and GPS Tracking Provider to Industry Competitor
On February 8, 2011, Epstein Becker Green's Corporate Services Group served as counsel in a divestiture transaction for Intergis, LLC. The fleet management consulting and GPS tracking provider sold substantially all of its assets to Telogis, Inc., a Delaware corporation located in Alisa Viejo, CA. The purchase price remains confidential.
This deal was challenging due to the complexity of the technologies and contractual relationships involved. Intergis provided GPS tracking services and fleet management and routing management services to a wide variety of companies, relying on vehicle fleets for the execution of their business objectives. A Delaware limited liability corporation and portfolio company of Columbus Nova, Intergis relied on contractual relationships with wireless subcontractors (KORE Telematics), as well as wireless service companies (AT&T), to provide wireless GPS service to its end users. Thus, the negotiation with third parties played a significant role in finalizing the terms of this transaction. Telogis has been a parallel competitor of Intergis, providing similar services to a different market segment, and their union of business efforts is expected to create significant synergies in the GPS tracking marketplace.
The Epstein Becker Green team was supervised by Robert D. Reif, with negotiations led by Lisa J. Matyas, who was assisted by Gretchen Harders and Paul C. Burkholder.
Epstein Becker Green Convinces Plan Review Committee to Overturn Termination of Participating Physician Group Services Agreement
On April 29, 2013, Epstein Becker Green achieved a major victory when the Plan Review Committee of L.A. Care Health Plan ("L.A. Care") found that L.A. Care's termination of the Participating Physician Group Services Agreement ("Agreement") with Epstein Becker Green client Accountable Health Care ("AHC") was procedurally unfair.
L.A. Care terminated the Agreement under a "without cause" provision and did not contend that AHC was in breach of the Agreement. Under Potvin v. Metropolitan Life Ins. Co., 22 Cal.4th 1060 (2000), California provides a common law fair hearing right to health care providers even in the event of a "without cause" termination. Arbitrary decisions and the denial of fair procedure are prohibited by Potvin. Contractual provisions allowing termination "without cause" are unenforceable to the extent that they do not provide fair procedure. Under Potvin, the termination of a provider's agreement must be both substantively rational and procedurally fair.
Epstein Becker Green argued on behalf of AHC that L.A. Care acted contrary to its own Fair Hearing Procedure and the legal principles of Potvin by issuing a notice of termination of the Agreement prior to the fair hearing and a decision by the Plan Review Committee, even though, at the hearing, L.A. Care argued that its decision was based on a cease-and-desist order against AHC that was filed by the California Department of Managed Health Care. Although the Fair Hearing Procedure provides that the hearing process must precede any issuance of a notice of termination under a provider contract, the termination notice and related correspondence made clear that L.A. Care had already reached a decision to terminate the Agreement at the time that the notice was provided to AHC. In addition, the notice failed to include the specific reasons for the termination, a description of any policies and procedures, or any other criteria used in making the determination, as required by the Fair Hearing Procedure.
The Plan Review Committee voted unanimously in finding that the L.A. Care termination notice was procedurally unfair because it was inconsistent with the requirements of the Fair Hearing Procedure and had been issued prior to the completion of the fair hearing process.
The Epstein Becker Green team representing AHC included Los Angeles attorneys David Jacobs, Paul C. Burkholder, and J. Susan Graham.