David H. Rich obtained a $6.05 million judgment on behalf of a neurosurgeon and her related corporate entities based on their contractual dispute with a hospital and its corporate parent.
The case concerned the failure by a hospital, MetroWest Medical Center, and its corporate parent, Vanguard Health System, to follow through on their contractual obligations to develop a world class center for advanced brain and spine surgery at Leonard Morse Hospital in Natick, Mass. At their core, the agreements contemplated that MetroWest would supply the space, personnel and equipment sufficient for the plaintiffs to develop and operate a groundbreaking brain and spine institute in the suburbs of Boston.
After failing to live up to their contractual commitments by, among other things, failing to purchase the required equipment, failing to train the nursing staff, failing to procure an academic affiliation, and failing to make available an MRI machine on a 24/7 basis, MetroWest and Vanguard prematurely cancelled the parties' agreement. A lawsuit followed.
Following a three-week bench trial, Justice Christine Roach of the Massachusetts Superior Court's Business Litigation session issued a 78-page decision in favor of Attorney Rich's clients.
The judge concluded that the defendants repeatedly breached the parties' agreements, and, moreover, that the hospital's chief executive had "either failed to use best efforts to Comply with the Agreements or actively undermined the Institute concept from (almost) its inception."
The judge further found the record "replete with persuasive evidence that MetroWest never properly informed its medical staff, other clinical staff or anyone else associated with the two hospitals … about its joint venture with [Plaintiffs] … it can only lead [the Court] to question the good faith of MetroWest's investment in the venture to begin with."
The judge concluded that the defendants' conduct caused the plaintiffs significant damages, and accepted, in part, the testimony of the plaintiffs' damages expert. The judge awarded the plaintiffs $3 million in lost profit damages and $652,000 in unpaid management fee damages, plus attorneys' fees, costs and prejudgment interest.
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