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NSBNews.Net file photo by Dale Smith who contributed to this breaking news story / Circuit Judge Richard Graham rejects the merger between Bert Fish and the Adventist Health Systems. We have complete coverage include the judge's ruling, which can be read by clicking the attachment as well as a series of exclusive videos throughout the merger process and through the courts.
DAYTONA BEACH -- Circuit Judge Richard Graham's verdict today in the civil trial that essentially nullifies the May 27 merger against the Bert Fish Medical Center merger with Adventists Health Systems is being hailed by the Bert Fish Foundation attorneys as a victory not only for government action in the sunshine, but also as a long-term savings to Southeast Volusia taxpayers who are already the highest taxed in Florida.
DAYTONA BEACH -- Circuit Judge Richard Graham's verdict today in the civil trial that essentially nullifies the May 27 merger against the Bert Fish Medical Center merger with Adventists Health Systems is being hailed by the Bert Fish Foundation attorneys as a victory not only for government action in the sunshine, but also as a long-term savings to Southeast Volusia taxpayers who are already the highest taxed in Florida.
"The judge's ruling is profoundly important for the Sunshine Law because it establishes clearly that the cure must be independent of the violation," said Jon Kaney Jr., of the Daytona Beach law firm of Cobb and Cole. he is considered Florida's preeminent expert in Florida's public records and open government statutes.
The "cure" Kaney referred to was public hospital Bert Fish's attempt to "redo" its merger after 21 closed-door meetings over 16 months between the two hospitals in violation of the state's Sunshine laws because Bert Fish receives public tax monies for indigent care from homeowners and businesses in New Smyrna Beach, Edgewater, Oak Hill and a portion of Port Orange. The final closed meeting and consensus occurred on May 27, 2010.
Just one hour after that meeting the board convened a public meeting to ratify what was already decided privately with no comments from the board members or the hospital administration led by then-CEO Bob Williams, who stepped down last month after receiving a $1 million-plus parachute.
Graham ruled Thursday afternoon the merger between Bert Fish and Adventist Health Systems was null and void and that the initial decision of Bert Fish Medical Center to affiliate with Adventist Health on May 27, 2010, “was previously determined to have been made in violation of the Florida Sunshine Law.”
The judge said he found that the attempts by the hospital to “cure” state Sunshine Law violations that resulted in a decision to affiliate with AHS under a modified proposal “were not sufficiently independent of the original unlawful decision to constitute a valid cure.”
The judge ordered both parties to come up with a plan, either jointly or separately, if no agreement can be reached within 30 days, for “an orderly method of transition of this hospital and AHS control back to public BFMC control.”
Graham said in his order this stipulation was made to have the least amount of disruption to the delivery of patient services, employee relations and existing contracts as possible.
Maryanne Downs, the attorney for the Adventists and Bert Fish did not return calls for comment, but Sara Brady, spokeswoman for the two hospitals, said: "We're disappointed in the ruling and we're looking at our options."
Brady declined to elaborate on possible options, including an appeal to the 5th District Court of Appeal or to ask Graham to temporarily "stay" or hold off on enforcement of his ruling pending an appeal.
Noah McKinnon, attorney for the Bert Fish Foundation, who retained Kaney for his Sunshine law expertise, was elated with the judge's ruling.
"I'm very happy -- very pleased," McKinnon said, adding, "This saves the taxpayers millions of dollars in the long run."
Following the May 27 meeting, Central Florida media organizations, including NSBNews.Net, began seeking transcripts of the closed meetings, which are required to be made when a public agency closes any meeting under claim of exemption from the state Sunshine Law.
The Bert Fish Foundation subsequently filed a lawsuit against the hospital citing violations of the Sunshine Law. Because of the lawsuit, hospital officials attempted to “cure” any violations by providing meeting transcripts to the public online and on display at the Atlantic Center for the Arts in New Smyrna Beach.
Judge Graham said in his findings that based on testimony, Bert Fish board members were never advised by their attorney Jim Heekin or CEO Williams that they probably should “undue the reverse merger with Adventist pending the outcome of the “cure” process.
In the subsequent cure process, Halifax Health Systems was among three suitors vying for a partnership. Jef Feasel, president and CEO of Halifax Health, was incensed at the closed-door meetings, but went through with the cure process in making a second presentation in vain.
He too was ecstatic with the merger being shot down Thursday. "We are pleased to hear of Judge Graham's decision.
"This decision reinforces the intent of the Sunshine Law and those who strive to operate within it," Feasel said. "Halifax Health stands ready to help the Southeast Volusia Hospital Taxing District and Bert Fish Medical Center in any way.
Halifax put up $250,000 in up-front legal fees to help Bert Fish Foundation in its trial.
Bert Fish Hospital was one of the hospitals constructed with funds provided under the will of Judge Bert Fish, which contained specific requirements for the use of the funds and the purpose to be served by the hospitals constructed by them.
The Bert Fish Foundation was established to oversee the management of this hospital. Bert Fish was operated by the foundation for a number of years until the mid-1960s when its board members realized they could not continue providing high quality of care to its patients, especially to the indigent.
In 1966 the Foundation received a consent court order in the Seventh Judicial Circuit allowing it to transfer the hospital to Southeast Volusia Hospital District, a special independent taxing district of Florida. In the deed, a reverter in favor of the foundation was inserted in the event that the requirements of Judge Fish’s will were abandoned.
The district then created the Bert Fish Medical Center Inc, a not-for-profit Florida corporation and the governing board of the new corporation consisted of the same seven individuals who served as commissioners of the hospital district, appointed by the governor.