A lawsuit opposing Jennie Stuart Medical Center’s acquisition by Evansville, Indiana-based hospital group Deaconess has resulted in a three-month delay of any agreement between the two hospitals.
At the conclusion of a hearing Friday morning, Christian Circuit Judge Andrew Self announced the “essense” of an agreement between the plaintiff, Save Jennie Stuart, and the defendants, Jennie Stuart and its board members. Attorneys and several individuals involved in the legal dispute reached the agreement while meeting privately with Self for close to three hours.
“All of the pending claims in the current litigation will be dismissed. The court will retain jurisdiction to enforce the agreement that’s going to be entered into by and between the parties,” Self said. “The essence of the agreement is this: Jennie Stuart Medical Center’s board of directors will extend its due diligence period with regard to the proposed transaction with Deaconess until March 31, 2025, and will not vote on the transaction before March 31.”
The hospital board had originally planned to vote on the Deaconess deal this month.
Self added, “Secondly, the full board may extend the letter of intent with Deaconess during that time period.
“Thirdly, there will be two additional persons added to the subcommittee that currently is composed of Leslie Carroll, Hollis White, Betsy Shelton and Marty Bozarth. Those new members will Carter Hendricks and Charles Turner.
“And then finally the Jennie Stuart Medical Center Board will actively pursue securing and preserving the independence of the Jennie Stuart Medical Center Foundation.”
The subcommittee Self referenced has been working through the details of an agreement between Jennie Stuart and Deaconess for several months.
In the lawsuit filed on Dec. 6, Save Jennie Stuart requested “a restraining order, preliminary injunction and permanent injunction” to prevent the hospital from executing the Deaconess transaction. Friday’s hearing did not result in any of those actions being granted.
Jennie Stuart’s board announced on Sept. 23 that it had signed a letter of intent to join Deaconess. A change in the local hospital’s ownership had been under review for several months before it became public. Proponents of the Deaconess acquisition have said it is a strategic move in the best interest of protecting Jennie Stuart’s long-term viability. Opponents say it will diminish local control of the community-based, not-for-profit hospital.
The plaintiffs estimate the hospital has a “book value” exceeding $157 million. They are critical of the hospital board’s use of a four-person subcommittee to largely handle the details of a transaction between Jennie Stuart and Deaconess.
Ben Lewis, a Louisville attorney with the firm Dentons Bingham Greenbaum that represents Save Jennie Stuart, said after Friday’s hearing that he expected an agreed order of dismissal between the two parties would be sent to the judge within a week or so.
However, the written agreement that spells out in more detail how the two parties resolved the lawsuit could remain confidential.
“I think that there may be an effort to keep it confidential, some terms confidential, for business reasons. But that is something discussed between all the lawyers,” said Lewis.
A motion filed on Thursday by attorneys for Save Jennie Stuart provides an indication of where each Jennie Stuart board member potentially stands on the question of a Deaconess acquisition.
The Motion to Realign Parties states that board members Steve Tribble, Carter Hendricks and Deanna Sova (described as “opposing directors”) should be realigned as co-plaintiffs with Save Jennie Stuart because each has joined the plaintiff in support of its lawsuit. “In fact, it is clear that Plaintiff and the Opposing Directors seek the same relief.”
Additionally, court documents list separate law firms representing two groups of hospital board members. The Bowling Green law firm of English, Lucas, Priest and Owsley represent Tribble, Hendricks and Sova. A Louisville firm, Stites & Hardison, represents the hospital and board members Alissa Young, Leslie Carroll, Marty Bozarth, Hollis White, Betsy Shelton, Dr. Matthew Robinson and Dr. Tarek Toubia. And board member Charles Turner is listed as an “individual defendant.”
This story may be updated.
Jennifer P. Brown is co-founder, publisher and editor of Hoptown Chronicle. You can reach her at editor@hoptownchronicle.org. Brown was a reporter and editor at the Kentucky New Era, where she worked for 30 years. She is a co-chair of the national advisory board to the Institute for Rural Journalism and Community Issues, governing board past president for the Kentucky Historical Society, and co-founder of the Kentucky Open Government Coalition. She serves on the Hopkinsville History Foundation's board.
