HealthSouth Corp. founder and former CEO Richard Scrushy will be able to travel to Atlanta, New York and Washington to consult with his attorneys now that a federal judge relaxed his strict travel restrictions implemented last month. U.S. District Court Judge Michael Putnam also gave Scrushy permission to travel throughout Alabama and Florida to look after his properties and business interests, but he will not be able to take trips more than once a month and for longer than 48 hours at a time. According to a 10-page order released Monday, Scrushy's probation officer must be notified of the dates and times of any proposed travel and his wife and children must remain home in Birmingham, Ala., to lessen any flight risk. After being indicted on 85 counts of fraud last month and posting a $10 million bail, Scrushy was put under strict travel provisions to prevent him from fleeing the country. The government is alleging he orchestrated $2.7 billion in accounting fraud at HealthSouth, which is based in Birmingham. He has pleaded not guilty to all counts and continues to maintain his innocence. Fifteen former HealthSouth executives, including five past CFOs, have pleaded guilty to various fraud charges in connection with the massive scandal.
Meanwhile, in a lawsuit filed this week in Jefferson County (Ala.) Circuit Court, former HealthSouth executive Jason Hervey is seeking $400,000 in severance pay and stock options he said the company owes him after his position was eliminated during cost-cutting. Hervey, a child actor who was tapped personally by Scrushy to become senior vice president of media and communications at the company, was under contract to be paid $300,000 annually for three years. While he was offered a lump-sum payment of what HealthSouth owed him under contract or payments of roughly $11,500 every two weeks in addition to maintaining his insurance and company benefits, he opted for the biweekly payments and benefits. The suit alleges HealthSouth stopped paying Hervey in November. At deadline, officials at HealthSouth could not be reached for comment. -- by Julie Piotrowski