St. Alphonsus Regional Medical Center has been ordered to pay $52 million to an MRI company for violating a partnership agreement it had with the firm and forming a competing company, the Associated Press reports. The jury verdict, handed down Monday, is one of Idaho's biggest ever; earlier, another jury awarded MRI Associates $63.5 million in damages in 2007; a judge later reduced that award to $36 million, and in 2009 the Idaho Supreme Court sent it back for a new trial, which started Sept. 6 and lasted eight weeks. A St. Alphonsus spokeswoman said the hospital again plans to appeal; click below for a full report from the AP.
Wade Woodward, one of the attorneys with the Boise firm of Banducci Woodard Schwartzman, which represented MRI Associates, said, "Two separate juries have unanimously found that St. Al's acted badly by intentionally competing with its partners while it was in the partnership." His firm characterized the case as a “David vs. Goliath legal battle, pitting a small business against an enterprise-level regional medical center with revenues of $450 million in 2009 and a parent company, Trinity Health, that boasted assets of more than $8 billion at the end of that year.”
Idaho hospital to pay $52M to former partner
BOISE, Idaho (AP) — A jury has ordered a Boise hospital to pay $52 million to an MRI company for violating a partnership agreement it had with the company. The award is one of the largest to ever come out of the Idaho district courts.
It's the second time the lawsuit, brought by MRI Associates against Saint Alphonsus Regional Medical Center, has gone to trial. The first trial ended in a $63 million verdict, but that was later overturned by the Idaho Supreme Court.
Saint Alphonsus spokeswoman Elizabeth Duncan says the hospital is disappointed with the verdict and will appeal.
MRI Associates, which operates MRI Center of Idaho and MRI Mobile, partnered with St. Alphonsus in 1985 in an effort to make magnetic resonance imaging and other diagnostic tests more accessible to the hospital. The partnership was slated to last until at least 2015. But in 1998, a group of radiologists from Saint Alphonsus decided to build their own outpatient medical imaging facility, and in 2004 the hospital told MRI Associates it was leaving the partnership in favor of the competing company.
The hospital then sued MRI Associates for its portion of the ownership in MRI Associates. The MRI company countersued, contending the hospital breached the terms of the partnership agreement when it became a competitor.
The case first went to trial in 2007, when a jury awarded MRI Associates more than $63.5 million in damages. A judge later reduced the award to $36 million, and in 2009 the Idaho Supreme Court sent it back for a new trial. The retrial ended on Tuesday, when the jury awarded MRI Associates $52 million.
MRI Associates attorney Wade Woodard said in a prepared statement that the jury agreed Saint Alphonsus had violated the partnership agreement by intentionally competing with its own partners and breached the covenant of good faith and fair dealing.
Copyright 2011 The Associated Press.