A jury in Boise sided this week with a local radiology group that sued the Saint Alphonsus Regional Medical Center and a related corporate entity for pulling out of a partnership and joining a competing one.
The verdict is the second-highest Idaho jury award in at least five years.
The radiology company MRI Associates claimed Saint Alphonsus wrongfully broke a partnership about seven years ago, then worked against its former partner.
The dispute previously led to a $36 million damages award against Saint Alphonsus. But that decision was overturned by the Idaho Supreme Court in 2009 and sent back to the lower court.
This time, the jury said Saint Alphonsus:
• Breached its partnership agreement by violating a non-compete clause and engaged in a civil conspiracy.
• Mishandled an opportunity to partner with radiologists in imaging centers and to open a facility in Meridian.
• Did not act in good faith and did not honor its fiduciary duty to MRI Associates.
• Intentionally interfered with MRI’s prospective contracts or business deals.
“Saint Alphonsus is obviously very disappointed with the outcome of the jury verdict,” spokeswoman Elizabeth Duncan said. “Saint Alphonsus has remained steadfast in its position since the litigation began in 2007.”
Wade Woodard, an attorney for the radiology group, said the hospital’s “conduct has pretty much forced MRI Associates out of business.” Its MRI Mobile practice could close while the lawsuit is being appealed, he said.
The verdict was higher than the previous award of $36 million because it has been a few years, and “new data” showed Saint Alphonsus made more money on the competing partnership, Woodard said.
BACKGROUND ON THE CASE
The hospital and MRI Associates agreed in 1985 to a 30-year partnership. Saint Alphonsus doctors would work with MRI Associates to do MRI scans, and radiologists from the Saint Alphonsus Radiology Group would read them.
About 14 years later, the Saint Al’s radiologists created Intermountain Medical Imaging and opened their own office to do MRIs and other services. Saint Al’s joined in 2001 with the non-MRI side of that group.
Starting in 2004, the hospital left its partnership with MRI Associates and sued the company for the value of its stake in the partnership.
Intermountain Medical Imaging is now one of the hospital’s top-paid independent contractors. Saint Alphonsus Regional Medical Center paid IMI about $3.4 million for radiology services in its most recent fiscal year, according to tax documents.
Audrey Dutton: 377-6448
