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PARKERSBURG - A federal jury found Camden-Clark Memorial Hospital Corp. liable for one count each of civil conspiracy and vicarious liability and awarded Memorial Health System $5 million in compensatory damages.
The verdict was reached Friday in the U.S. District Court for the Northern District of West Virginia in Wheeling following a trial that began Aug. 5.
"Memorial Health System is pleased that after a decade of investigation and appeal a jury has found Camden Clark Medical Center guilty of conspiracy and vicarious liability against Marietta Memorial Hospital," the health system said in a statement provided over the weekend.
"We have great respect for the judicial process and appreciate the jury's work and deliberations on this case," a Camden Clark spokesperson said in a statement.
Marietta Area Healthcare Inc., Marietta Memorial Hospital and Marietta Healthcare Physicians Inc. filed the lawsuit in 2023 against Camden-Clark Memorial Hospital Corp., Camden-Clark Health Services Inc., West Virginia University Hospitals Inc. and West Virginia United Health System Inc., alleging the groups supported efforts by two Camden Clark executives and a local physician to falsely accuse Memorial of overpaying doctors in exchange for referring patients.
Memorial has said in court filings that then-Camden Clark CEO Mike King and Dr. Michael Roberts with Parkersburg Surgical Associates filed a complaint with the U.S. Department of Justice in 2013, claiming Memorial was violating federal law by over-compensating physicians and other healthcare providers. King and Roberts filed a lawsuit over the allegations in 2016.
Memorial said in court filings those individuals knew the allegations were false and the resulting multi-year federal investigation cost the health system millions of dollars and had a negative impact on its ability to recruit physicians. Memorial CEO Scott Cantley previously said the cost of the time and resources spent responding to the complaint, plus lost opportunities, could exceed $100 million.
"The Department of Justice ultimately found no evidence of wrongdoing by Marietta Memorial Hospital," Memorial's weekend statement said.
The suit was dismissed in 2020, which unsealed the original complaint document. Memorial filed suit in 2021 against King and Roberts. Then-Camden Clark legal counsel Todd Kruger was added as a defendant in 2022 after Memorial's attorneys claimed it was discovered that Kruger aided in the original filing with the knowledge and approval of at least some members of the hospital's and WVU Medicine's leadership.
King and Roberts settled with Memorial, as did Kruger following a mistrial declaration in 2023 when the jury could not agree on a verdict. That year, Memorial filed suit against the Camden Clark and WVU Medicine corporate entities, saying discovery in the first case indicated their participation.
That 2023 case was the one in which the verdict was rendered Friday.
"The jury concluded that the investigation harmed the hospital and affected its ability to recruit physicians and compete fairly," Memorial's statement said.
All the West Virginia entities denied involvement in the original complaint, with Camden-Clark Hospital Corp.'s initial response saying it would have taken steps to stop Kruger's actions had it been aware of them.
But the jury found the corporation liable for vicarious liability, specifically referring to "tortious conduct committed by Todd A. Kruger," as well as a count of civil conspiracy. “Tortious” refers to a tort, a civil wrong or wrongful act that causes harm to someone and allows the injured party to sue for financial damages, according to a Google definition.
They did not find the corporation liable for counts of malicious prosecution, abuse of process, fraudulent legal processes, negligent supervision in regard to Kruger and vicarious liability in regard to King.
They did not find the other two defendants, Camden-Clark Health Services Inc. and West Virginia United Health System Inc., liable on any of the seven counts. West Virginia University Hospitals Inc. was not included in the verdict after Judge John Preston Bailey issued a directed verdict in its favor before the case went to the jury.
The jury did not find Memorial was entitled to punitive damages.
"The jury found WVU Medicine Camden Clark Medical Center liable for $5 million in damages to Marietta Memorial Hospital," Memorial's statement said. "This will serve as a landmark for health systems in America who respond to false whistleblower lawsuits.
"We are thankful to the jury for their time and verdict, and for supporting this long journey that will enable us to move forward while holding WVU Medicine Camden Clark and administrative officers responsible for their actions," the statement says. "Marietta Memorial Hospital and our entire health system remain committed to delivering excellent, locally accessible healthcare that meets the needs of our region and helps move our communities forward."
Evan Bevins can be reached at ebevins@newsandsentinel.com.