Surgical hospital operator Dynacq Healthcare said it is being investigated by the Texas attorney general's office for possible violations of patient solicitation laws and recently was asked by the office for documents relating to patient deaths at its facilities since Jan. 1, 1999. Dynacq also said its chief operating officer, Sarah Garvin, resigned but will continue to work for the company as a consultant. CEO Chiu Chan will serve as acting COO until a replacement is named. Dynacq, Pasadena, Texas, said it believes complaints received by the attorney general's office, which resemble those in a pending private lawsuit, are without merit.
In December 2003 the company said it would postpone filing its audited financial statements for the fiscal year ended Aug. 31, 2003, and would request a hearing on a proposed de-listing of its stock by the NASDAQ stock exchange. Dynacq did not return telephone calls seeking comment on the status of its request for a hearing. A NASDAQ spokesman declined to comment. Dynacq operates surgical hospitals in Texas and Louisiana. It ranked second among Forbes' 200 Best Small Companies in 2002 based on profit margins. -- by Mary Chris Jaklevic