Suing a would-be seller for fraud and breach of contract isn't the most diplomatic way to buy back a medical practice, but it's become an integral part of negotiations for a group of Utah physicians.
Representatives of 10-physician Park City (Utah) Family Health Center, about 25 miles east of Salt Lake City, say the University of Utah Health Network's tough stance on a practice buyback was immediately softened by the lawsuit, filed last week in Utah Judicial District Court.
The physicians want more time to examine the offer that's been made to them, according to their representatives. The university would not disclose the details of the proposal.
"I'm optimistic that this repurchase can occur. Just recently we didn't feel that way," said Martha Amundsen, the physicians' lawyer.
She said closing a deal would likely end the litigation, even though allegations in the suit stem from the way the network managed the doctors, not how it conducted negotiations.
The university, however, said the doctors don't have too much time to ponder the offer. "We're left with a choice of selling the clinic to the physicians or hiring replacements by July 1. The window is upon us," said Fred Esplin, vice president for university relations.
University of Utah Hospitals and Clinics bought the physician practices in 1995. However, friction between the physicians and the university mounted in 1998, when UUHC purchased a network of seven clinics throughout Utah from PacifiCare Health Network, the former MedPartners and other companies for a total of $35 million. The university paid about six times the amount the Park City physicians were paid for their practices, Amundsen claimed.
Tensions culminated last December, when the University of Utah Health Network, UUHC's clinical affiliate, proposed terminating the Park City doctors' employment contracts as part of a reorganization to cut losses, according to the lawsuit. The physicians balked, citing noncompete clauses that would have prohibited them from practicing in the region for the next two years.
In mid-March the health network made a sudden offer to sell the practices back to the physicians, but proposed too narrow a time frame for the buyers to examine the merits of the deal, according to Paul Sincock, who is representing the physicians in their negotiations.