U.S. Bankruptcy Court Judge Bruce McCullough found Friday that Children's Hospital of Philadelphia was in contempt of court for hiring two emergency room doctors from rival St. Christopher's Hospital for Children in Philadelphia, which is owned by Allegheny Health, Education and Research Foundation.
During an emergency hearing in Pittsburgh, McCullough ruled that Children's had violated his orders barring potential bidders who reviewed confidential records concerning AHERF's bankrupt Philadelphia assets from soliciting business arrangements with any AHERF-affiliated physicians until six months after the close of a sale.
McCullough ordered the doctors' new employment contracts with Children's dissolved. He also directed Children's to pay Santa Barbara, Calif.-based Tenet Healthcare Corp. $60,500: $25,000 for each violation plus $10,500 in legal fees.
"(Children's) intends to appeal the decision immediately in federal district court in Pittsburgh," said Sarah Jarvis, a spokeswoman who otherwise declined to comment.
The ruling "sends out an unequivocal message to any other of the potential bidders that the judge is very serious about prohibiting physician recruitment," said Lance Ignon, a Tenet spokesman. Tenet, he said, would donate the $50,000 fine to a pediatric charity and would welcome the physicians back to St. Christopher's.
St. Christopher's is one of eight bankrupt AHERF hospitals that Santa Barbara, Calif.-based Tenet is scheduled to buy on Nov. 10 (See related story, p. 14).
Tenet precipitated the ruling by filing a motion for punitive action against Children's late last week. In so doing, Tenet fired shots across bows of other Philadelphia hospitals considering poaching physicians from the AHERF properties.
At the center of the controversy were Richard Scarfone, M.D., and Joanne Decker, M.D., who resigned from St. Christopher's early last week. They represented one-third of the hospital's emergency room staff, according to an affidavit by Curtis Bland, president and chief executive officer of St. Christopher's. Bland said their departure would create "serious staffing problems" and present "an immediate danger to the safety and welfare of the community."