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Hospital legal bill: $8.4M

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By Mike Wright

The two sides battling for control of Citrus Memorial hospital paid attorneys a combined $8.4 million since 2009 to fight lawsuits and governance issues that have torn the groups apart, according to records and interviews.

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Citrus Memorial Health System has spent about $1.6 million more than the Citrus County Hospital Board, according to records obtained by the Chronicle through a public records request to the hospital board.

Attorneys Bill Grant from the CCHB and Clark Stillwell from the Citrus Memorial Health Foundation confirmed the amounts.
Chairpersons from both organizations admitted the public has lost its patience with the costly dispute.

“I think it’s sad,” foundation Chairman Bob Collins said. “The taxpayers should be feeling it.”

Hospital board Chairwoman Debbie Ressler said: “It’s a chunk of change. I’m sure they’re very upset. The public is all over it.”

The dispute began in 2009 with a group of physicians who believed Citrus Memorial’s expansion provided unfair competition for the doctors. Hospital board members began requesting public records of the foundation and Sen. Charlie Dean successfully convinced the state to conduct an audit of hospital finances.

Grant became the hospital board’s attorney in September 2009. He is not on retainer and charges hourly rates of $225 and $250, he said.

His predecessor charged the hospital board $6,000 a year to attend meetings and offer advice.

Grant’s first monthly invoice totaled $29,227, according to a Chronicle story. He billed $300,963 his first year, records show.

In the fall of 2009, seeking to rein in spending, the hospital board withheld funds until the hospital provided a detailed budget. That led to the first lawsuit in late 2010 by the foundation, claiming trustees were illegally withholding tax money meant to help operate the hospital.

Numerous lawsuits followed from both sides on issues ranging from the Sunshine Law to a severance package for hospital administrators should they lose their jobs in a hospital board takeover.

Most of those lawsuits have either disappeared, or lay dormant since November as both sides await a state Supreme Court hearing or decision on the case with the biggest ramifications.

After lobbying unsuccessfully to stop a 2010 bill that gave hospital oversight to the CCHB, the foundation sued once Gov. Rick Scott signed the bill into law. A circuit court judge sided with the CCHB; the foundation won on appeal and now the matter rests with the state Supreme Court.

2 attorneys for foundation; 12 for CCHB

Grant responded to the Chronicle’s request to view attorney’s fees by providing a month-by-month spreadsheet over four years for both the CCHB and foundation. Stillwell gave the foundation attorney fee amounts to Grant, who also had provided his client’s attorney fee amounts to Stillwell.

With Stillwell listing the scope of work for each attorney, Grant separated out attorneys whose work for the foundation is not connected with the governance or legal issues.

For the CCHB dispute, most of the foundation’s fees rest with two attorneys: Stillwell, the hospital’s corporate counsel from Inverness, and James Kennedy from the Tampa law firm Carlton Fields (Kennedy represented Citrus Memorial in 2009 and part of 2010 with a different law firm, Buchanan Ingersoll & Rooney.)

Records show Kennedy billed the hospital about $4.6 million since 2009 and Stillwell billed $1.2 million.

Stillwell confirmed the amounts to the Chronicle, but said both he and Kennedy have other duties. Stillwell oversees all hospital legal matters. Kennedy successfully defended the hospital in a whistle-blower case and also has handled property transactions, Stillwell said.

He suggested subtracting 15 percent from Kennedy’s listed fees and taking 25 percent off his. That would bring Kennedy’s total to about $3.9 million and Stillwell to just under $900,000 for legal and governance issues.

On the CCHB side, Grant, an Inverness lawyer, has billed the most of 12 attorney firms that have had some role on the CCHB’s behalf in the hospital dispute. Grant’s total shows $1.45 million; like Stillwell, though, he said about 20 percent is billed for other purposes. That would bring his total to $1.2 million for the dispute with the foundation.

All the other attorneys listed, he said, were hired in relation to the hospital dispute.

Both Stillwell and Grant hope a resolution is looming soon. With the hospital likely headed to a sale, lease or merger in the coming months, board members say they want the dispute to end.

“Going forward, this finger-pointing doesn’t do anybody any good at this point,” Stillwell said.

Grant said both sides deserve criticism.

“The taxpayers are going to be upset with the Citrus Memorial Health Foundation and the Citrus County Hospital Board for not being able to resolve their differences, and I believe their animosity is well founded,” he said. “No one’s happy about it.”

BY THE NUMBERS

Governance/legal fees expended by the Citrus County Hospital Board and Citrus Memorial Health Foundation since 2009 (Years listed are fiscal years)

2009-10
CCHB: $627,807
Foundation: $1 million

2010-11
CCHB: $1.3 million
Foundation: $1.9 million

2011-12
CCHB: $780,495
Foundation: $2.1 million

2012-13**
CCHB: $399,654
Foundation: $462,236

Total*
CCHB: $3.7 million
Foundation: $6 million

*These numbers reflect the totals provided to the Chronicle. However, according to Foundation attorney Clark Stillwell, up to 20 percent of the Foundation fees were for purposes other than governance/lawsuits. CCHB attorney Bill Grant said the same percentage of his billing are for reasons other than governance/lawsuits.

**Through May 2013.

Source: Citrus County Hospital Board

Contact Chronicle reporter Mike Wright at 352-563-3228 or mwright@chronicleonline.com.