Firm Negotiates $550,000 Settlement in Favor of Saint Michael’s Medical Center against its Former Chief of Cardiothoracic Surgery

A team of attorneys from Genova Burns’s Complex Commercial Litigation and Employment Law & Litigation Practice Groups secured a $550,000 settlement in favor of Saint Michael’s Medical Center against a world-renowned cardiothoracic surgeon.

In 2009, Saint Michael’s negotiated a five-year contract with a physician under which he was required to perform medical and administrative services in exchange for a lucrative salary and various other benefits. However, in late 2010, the physician sent correspondence to the hospital stating that because he did not receive one of his bonus payments on time, he was terminating his employment agreement and going to work for one of the hospital’s competitors. Immediately after receiving the letter, Saint Michael’s issued the full bonus payment. Notwithstanding, the physician terminated the employment agreement and the hospital consequently filed a lawsuit for breach of contract, breach of confidentiality, and wrongful solicitation (amongst other causes of action).

The central question presented by the lawsuit was whether two emails, which casually stated that the physician’s bonus had not been timely paid (and which were not served by a method of delivery permitted under employment agreement), nevertheless, could be considered notices of breach. If so, the physician would be entitled to terminate the contract after the breach was not cured within a specified period of time. However, if the emails did not constitute notices of breach, then the physician’s termination would have been improper as he failed to give proper notice of breach and an opportunity to cure.

Ultimately, after almost six months of bench trial before Hon. David B. Katz, J.S.C., the physician agreed to pay Saint Michael’s Medical Center $550,000 to settle the lawsuit. This settlement marks a clear victory for hospitals and other healthcare institutions seeking to enforce their rights against a breaching physician or any other employee who refuses to comply with his or her contractual obligations.

The Genova Burns team on this matter included Associates Justin A. Jacobs and William G. Nestor, III.