MetroWest Hospital, Vanguard, Ordered to Pay $6 Million in Settlement

By Charlene Arsenault

A hospital and its corporate parent must pay $6.05 million in a judgement after its failure to follow through on a contractual obligation to develop a center for advanced brain surgery at Leonard Morse Hospital in Natick.

According to David Rich, the Sudbury attorney who handled the case, neurosurgeon Dr. Sagun Tuli and her related corporate entities had agreements with the hospital that “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.”

The judge awarded the neurosurgeon and team $3 million in lost profit damages, and $652,000 in unpaid in unpaid management fee damages, plus attorneys’ fees, costs and prejudgment interest.

MetroWest and Vanguard failed to adhere to the contract, with Rich citing that the company failed to purchase equipment, train staff, procure academic affiliation and make available an MRI machine on a 24-hour basis. According to Rich, MetroWest and Vanguard prematurely canceled the parties’ agreement, which was then followed by a lawsuit.

After a three-week 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,” said Rich, “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, said Rich, 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.