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Ferguson Medical Group Files Eight-Count Antitrust Suit Against Missouri Delta Medical Center

Posted on: Thursday, 19 January 2006, 12:00 CST

Ferguson Medical Group (FMG), the premier provider of quality, local medical care and services, announced it has filed an antitrust action against Missouri Delta Medical Center (MDMC) of Sikeston, Missouri. The suit, filed yesterday in the Southeast Division of the U.S. District Court, cites a history of intentional actions by MDMC designed to restrain competition for medical and diagnostic services in an effort to control the market and limit patient choice to MDMC. In addition to MDMC, defendants named in the FMG suit are board members Robert Scott Matthews, and President and CEO, Charles D. Ancell.

"Ferguson Medical Group has a long history of leadership in putting community and patient care first and of working closely with the hospital," said Dr. Jim Heath, a family practice physician and managing partner at FMG. "We want to be very clear that the suit pertains to hospital management issues and is not intended to reflect poorly on the staff in any way. We very much respect and value the care they provide to our patients."

"In fact," said Dr. John Askew, a recently retired physician who was with FMG for more than 31 years, "It's hard to imagine what the hospital or Sikeston would be like without our group. In particular, it is clear historically that we have always been supportive participants in the mission of our local hospital. After all, we contributed $100,000 to help build its pediatric wing addition, so we have true equity in its business as well as our own. But, we also believe that competition improves quality, lowers cost and offers patients more choice. For example, MDMC attempted -- but failed -- to prevent FMG from bringing a freestanding MRI to our community. Only after that failure did MDMC decide to replace the 20-year-old mobile unit it was having brought to town three times per week. MDMC has not only violated the spirit of free enterprise and community service but is attempting to restrict competition in a manner that harms our business."

The antitrust suit is a civil action for treble damages and attorneys' fees for injury caused by MDMC to competition generally, and for money damages incurred by Ferguson. Money damages, the suit claims, are directly tied to the predatory practices of MDMC by not ensuring that protective covenants -- in essence, contract buyouts or payments -- were fulfilled by departing physicians. The buyout clause is designed to prevent a physician from walking off and leaving the remaining physicians with his/her share of the company debt. In this case the outstanding collective debt of Drs. Thornton, Rankin, Poole, Uthoff & Helfrich left with FMG physicians exceeded $1 million.

"As we work to settle these legal management issues we know that our professional relationship with the hospital and the fulfillment of expert patient care will continue," said Dr. Kevin Blanton of FMG's pediatrics department. "We are confident that once we are able to stop the predatory behaviors and, once again, provide a level playing field for all doctors in this community, that a good working relationship will be restored. However, for that to occur, Missouri Delta Medical needs to rectify the misdeeds and change the organization to prevent such behavior from occurring in the future. FMG certainly has no problem with fair competitions -- we welcome it. It is the abuse of MDMC's dominant position that prevents competition."

Elements of the suit include allegations of barriers to entry of new competition, lock-up of services through execution of exclusive contracting, interference with FMG's retention and/or recruitment of expert staff, and other predatory and anti-competitive acts. Charges also detail efforts, on behalf of Matthews and Ancell, to "get in the way" and "bust up" FMG with the stated intent of putting the local physician group out of business.

The suit further charges the defendants with attempts to interfere with and induce breach of contracts with former physician partners of FMG. Claims in the complaint accuse the defendants of using third-party agents to distance and protect themselves from these improper recruitment activities. Counts of the antitrust suit further allege that the defendants engaged in many acts to exercise monopoly power within the relevant service area.

FMG is requesting that the suit be heard at the court's earliest convenience in order to limit further interference with marketplace competition.

Attention Editors: A copy of the complete filing is available via U.S. or email from the contact listed.

About Ferguson Medical Group, L.P.

For more than 45 years Ferguson Medical Group (FMG) and its expert team of physicians, specialists and healthcare professionals have been serving the Southeast Missouri delta region and surrounding rural communities with the highest level of quality medical and surgical care. FMG is one of the largest multi-specialty health groups between Memphis and St. Louis, offering full patient care under one roof, including: Family Practice, Pediatrics, Internal Medicine, Ophthalmology, Otolaryngology and Podiatry; an After Hours Urgent Care; a complete testing laboratory; radiology and pulmonary facilities; bone density scanning capabilities; and a full-service pharmacy all on-site for maximum patient care and convenience. In addition, a new imaging center offering complete CT & MRI services is conveniently located on-site as well. For more information on Ferguson Medical Group and its health and medical service and product offerings please visit www.fergusonmedical.com.

Source: Business Wire

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