Supreme Court asked to rehear hospital case

Despite a West Virginia Supreme Court ruling, attorneys for the Morgan County Commissioners and War Memorial Hospital continue to try to gain control of the nearly $675,000 surplus in an employee pension plan.

The commissioners and hospital have petitioned the State Supreme Court to rehear the case of 15 hospital employees who were granted a partial victory in their battle for the surplus.

In June, the State Supreme Court unanimously ruled that the only real option, once the plan was terminated by the hospital in 2003, was to divide the assets among the participating employees.

A hearing to determine how to distribute the funds had been expected this summer before Judge John Yoder in Morgan County Circuit Court.

Other issues still to be resolved include the employees’ claims of breach of fiduciary duties by hospital officials. The employees are seeking more than $1 million in damages, interest and attorney fees.

Judge Yoder delayed any action on the case after attorneys for the commissioners and hospital filed the appeal for a rehearing in late July.

The petition was filed while the supreme court was on summer recess. The court reopens tomorrow, September 9, but it is not certain when a decision will be made about a rehearing.

County still responsible
The Morgan County Commission is involved because the employee lawsuit was filed in June 2007 when War Memorial Hospital was still owned by county government.

Under the hospital sale contract, the commissioners are responsible for any legal actions filed before Valley Health Systems, Inc. bought the hospital earlier this year.

The county’s legal bills are being paid by their insurance company, said Morgan Commission president Brenda Hutchinson.

Attorneys Richard Gay and Nathan Cochran represent the commissioners. Baltimore attorney John Baldwin represents the hospital and its board, former Hospital Administrator John Borg and Valley Health Systems.

The employees are represented by Lawrence Schultz and Mark Jenkinson.
Got it wrong?

In their written opinion released on June 15, the State Supreme Court justices brushed aside the arguments raised by the attorneys for the hospital and commissioners.

The court upheld a ruling handed down in July 2009 by Judge Yoder who also concluded that the hospital employees had a right to the surplus funds.

For the past eight years, hospital officials have tried to close down
the pension fund, distribute about $10,000 to each of the covered employees, and put the $674,351 surplus toward a new hospital.

The State Supreme Court justices, however, called the hospital’s legal arguments “little more than a smorgasbord of red herrings.” They said pension plan documents specifically state the hospital has no right to the surplus money.

In their appeal for a rehearing, the hospital and commission attorneys argue that the justices got the case wrong and that their ruling was contrary to established law and previous decisions.

The employees who brought suit for the pension funds are Jennifer Baker, Sharon Hendershot, Janet Horner, Barbara Johnson, Terry Kesecker, Carol Layton, Tanya Manley, Helen Miller, Christine Mullen, Ruth Smith, Bernice Stotler, Dee Ann Stotler, Linda Stotler, Nancy Waugh and Barbara Yost.