Phoebe North Hospital located on Palmyra Road.
ALBANY, Ga. - Albany attorney Bo Dorough, on behalf of Dr. Corleen Thompson, filed a petition in Dougherty Superior Court on Thursday against the Hospital Authority of Albany-Dougherty County in an attempt to get the lease for Phoebe North set aside until the U.S. Supreme Court has ruled on the Federal Trade Commission's appeal of the hospital's purchase.
Among other things, the petition notes that Phoebe North, formerly Palmyra Medical Center, has been operating under a management services agreement — which is not set to expire until December 2013 — since it was acquired by the Hospital Authority.
"(Phoebe North) is operating under a management services agreement (until December 2013), so there will be nothing interrupted if (activation of the lease is delayed) until the Supreme Court ruling," Dorough said.
"There is no compelling reason for entering into a lease until the Supreme Court makes a decision. (Moving forward with the lease now) shows contempt for the court and for Dougherty County."
A lease for Phoebe North is set to become effective on Aug. 1.
"Phoebe has not been named as a party to this lawsuit, but it appears to be a warmed-over version of the lawsuit filed by the same plaintiff and same lawyer last December," Jackie Ryan, vice president of corporate strategy at Phoebe Putney Memorial Hospital, said Friday. "The Court denied an injunction at that time, and the suit was dismissed. There was no merit then and there is no merit now.
"Phoebe's focus is on providing the citizens of the region the best healthcare possible, and we continue to work toward that objective. It is unfortunate that there are those whose objective, whatever their motive may be, seems to be to obstruct that effort."
The petition contends that Phoebe Putney Memorial Hospital and Phoebe Putney Health System, on the advice of counsel, identified the Hospital Authority as the entity which would be purchasing Palmyra "for the express purpose of avoiding antitrust scrutiny and enforcement" — and that the Authority approved the purchase without undertaking a substantive analysis of the purchase agreement.
"The injunction contends that the Authority did not make an effort (to seek any other bids on Palmyra)," Dorough said. "They never got appraisals, so they don't know how much it is worth."
Three arguments the plaintiff makes in support of the case to grant injunctive relief are the likelihood that the FTC will prevail in the appeal, the Authority's failure to comply with Georgia law, and that the Authority continues to act as a "strawman" for Phoebe Putney Memorial Hospital and the health system, the petition reads.
The petition requests a temporary restraining order and then the scheduling of a hearing to determine the merits for injunctive relief, and for the court to enter into an interlocutory injunction prohibiting the Authority from leasing Phoebe North, or an affiliated organization, pending a trial of merits.
Should the temporary order be denied, Thompson is seeking judgment setting aside the lease. The petition goes on to say that the Authority should further be ordered to pursue "a viable, independent competitor" to operate Phoebe North.
A similar suit was filed in Dougherty Superior Court by Dorough on behalf of Thompson late last year. It was dropped shortly afterward — just a few days after the transaction on the Palmyra Road hospital went through on Dec. 15.
The $195 million purchase was completed and the transfer of ownership from the Hospital Corporation of America to the Authority took place at 12:01 a.m. the following day.
The FTC, which challenged the purchase, took its case to the Supreme Court after an 11th U.S. Circuit Court of Appeals ruling allowed the transaction to go through. The nation's high court agreed on June 25 to hear the FTC's appeal of the 11th Circuit's ruling.
Attached to the petition Dorough filed was correspondence he had with Jay Reynolds, attorney for the Hospital Authority. The letter from Reynolds, dated July 9, stated that the Authority was continuing to move forward its plans to lease Phoebe North. Reynolds' letter also made note of the previous suit.
"The issues raised by your proposed second complaint are essentially the same as the issues which you raised in the earlier complaint on Ms. Thompson's behalf," the letter read. "You and your client chose to dismiss that complaint voluntarily after (Dougherty Superior Court) Judge (Stephen) Goss denied your motion for an interlocutory injunction. We feel strongly that your second complaint, like your earlier complaint, is totally without foundation in law or in fact and is brought in bad faith. You and your client are unnecessarily expanding the proceedings and are being stubbornly litigious."
Court records indicate that the deadline to file the joint appendix and the FTC's brief on the merits is Aug. 20, with the deadline for the other side to file its brief on the merits set for Oct. 1.