Lahey lawsuit cost could become clearer – The Royal Gazette | Bermuda News, Business, Sports, Events, & Community

Log In

Reset Password
BERMUDA | RSS PODCAST

Lahey lawsuit cost could become clearer

Taxpayers may get a hint tomorrow of the potential cost of the Government's lawsuit against the Lahey Clinic, or at least an idea of how much could be spent on legal fees for it in the next fiscal year.

The publication of the Budget book for 2017-18, setting out likely spending from the public purse for every government department, should include an estimate for how much will be spent on legal services.

The estimated amount for this year was $4.7 million, while the previous year it was expected that $6.4 million would be spent.

With Attorney-General Trevor Moniz having hired the Boston office of law firm Cooley to pursue a civil complaint for unspecified damages against the Massachusetts-based teaching hospital, that figure could be set to rise considerably for the next financial year.

Mr Moniz has stonewalled questions from The Royal Gazette about the estimated cost of the lawsuit, as well as the amount of damages being sought.

And yesterday Senator Kim Wilkerson raised questions in the Upper Chamber about the potential cost of the case.

“I would hope that all of the necessary research has been done and all of the merits of the particular action have been considered critically before that decision was taken,” said the lawyer and Progressive Labour Party politician.

“Lawsuits against healthcare concerns are one of the things I deal with on a daily basis. And I know how expensive litigation can be in the US arena, particularly a litigation that's mounted in a federal court.”

Ms Wilkerson said: “I would be very curious as to what consideration there was of the litigation budget.

“When a party takes on the decided action to affirmatively sue another party — we are the party taking the action — you would have to have determined what that is going to cost you. And there is always a cost-benefit analysis done about pursuing litigation.”

She said anyone getting involved in a legal dispute had to weigh up the benefits of a court case and consider potential alternatives. She questioned whether “every consideration” was taken about the benefit of the action, asking: “What motivation drives it?”

The senator said the lawsuit was a “complete and utter shock” to her, adding: “The fact that the Bermuda Government has taken such an affirmative stance in litigation against a well-known, reputable institution is somewhat of a concern to me, from a reputational standpoint.”

Cooley is an international company, which opened its Boston office in 2007. It was ranked 35th in the 100 most prestigious law firms in the United States by Vault for 2017.

Two of its experienced partners, Luke Cadigan and Robert Lovett, are handling the case, along with two associates. Mr Cadigan's company biography cites “invaluable experience taking complex securities fraud matters to trial and an insider's perspective on how to best address government investigations and other regulatory scrutiny”.

Mr Lovett's refers to his experience litigating “high-stakes commercial and class action cases, as well as internal investigations and regulatory matters”.

The complaint, filed in a federal court in Massachusetts on February 14, alleges that Lahey paid bribes to Ewart Brown in order to receive preferential treatment when bidding on public healthcare contracts and to gain privileged access to Bermudian patients that it could service at its facilities in Massachusetts and in Bermuda.

The figure of $40 million is given as the amount paid to Lahey by Bermuda's public health insurers — including the government employee health plan, FutureCare and HIP — for services carried out on patients at the hospital in Massachusetts between 2006 and 2016.

The complaint alleges those were “services Lahey would not have received but for its relationship with Brown”.

It states: “Under principles of equity and good conscience, [the] defendants should not be permitted to retain the benefits they acquired through their unlawful conduct.

“All funds, revenues, and benefits received by them rightfully belong to Bermuda and should be returned to Bermuda in an amount to be determined at trial.”

The Ministry of Legal Affairs was unwilling again to share any information yesterday on the likely cost of the case.

We also got no answers on the number of ongoing civil litigation cases being handled by the Attorney-General's Chambers, how many were instigated by the Government, the cost to the public purse of civil litigation for this fiscal year and the estimated costs for next year.

One recent example of how legal fees can impact the public purse is the $4.1 million it cost for lawyers to negotiate the airport redevelopment deal over a three-year period.

• On occasion The Royal Gazette may decide to not allow comments on a story that we deem might inflame sensitivities. As we are legally liable for any slanderous or defamatory comments made on our website, this move is for our protection as well as that of our readers.

Raising awareness: Senator Kim Wilkerson, curious about expenses

You must be Registered or to post comment or to vote.

Published February 23, 2017 at 8:00 am (Updated February 24, 2017 at 1:17 pm)

Lahey lawsuit cost could become clearer

What you
Need to
Know
1. For a smooth experience with our commenting system we recommend that you use Internet Explorer 10 or higher, Firefox or Chrome Browsers. Additionally please clear both your browser's cache and cookies - How do I clear my cache and cookies?
2. Please respect the use of this community forum and its users.
3. Any poster that insults, threatens or verbally abuses another member, uses defamatory language, or deliberately disrupts discussions will be banned.
4. Users who violate the Terms of Service or any commenting rules will be banned.
5. Please stay on topic. "Trolling" to incite emotional responses and disrupt conversations will be deleted.
6. To understand further what is and isn't allowed and the actions we may take, please read our Terms of Service
7. To report breaches of the Terms of Service use the flag icon