Hospital wins $156K verdict from doctor who failed to uphold contract

David Yates Oct. 29, 2009, 10:12am

After his contract was terminated in 2004, Dr. James Grubbs filed suit against Memorial Hermann Baptist Beaumont Hospital alleging he was let go for reporting illegal Medicare billing practices.

However, when the trial started earlier this month, the hospital claimed Grubbs' contract was terminated because he "failed to use his best efforts to bill and collect."

And on Thursday, Oct. 22, jurors sided with Memorial Hermann, ruling that Grubbs failed to comply with the agreement he signed.

Not only did jurors rule in the defendant's favor, they awarded the hospital $156,081 in damages -- money that the defense claims Grubbs milked from the hospital.

During the trial, Grubbs testified that computer problems kept him from his billing duties.

Defense attorney David Bernsen openly called Grubbs' computer problems an "excuse" as he testified, prompting plaintiff's attorney Gary Cornwell to object to his counterpart's "sidebar."

Jurors didn't by the reason either.

Bernsen said Grubbs failed to collect a single cent from patients he treated during the first months of his practice.

He also told jurors that Grubbs had not spent any of the $10,000 the hospital loaned him to promote and market his practice, insinuating that perhaps Grubbs was not motivated in growing his practice but was content to milk the hospital for the duration of his contract.

The contract, court records show, called for Baptist Beaumont to reimburse Grubbs up to $20,000 a month for one full year.

Hypothetically speaking, Bernsen said, if Grubbs collected $5,000 in the month of February 2004, then the hospital would be on the line to pay him $15,000 - and if Grubbs made nothing, then Baptist Beaumont would be on the hook for the full $20,000.

Bernsen is attorney for the Beaumont law firm Moore Landrey.

Cornwell has a practice in Beaumont.

Case No. A173-730

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