Richard Scrushy paid HealthSouth Corp., Birmingham, Ala., $17 million to settle a shareholders' suit over a loan Scrushy received from the company while serving as its chief executive officer. The payment was ordered by Delaware Chancery Court, which ruled in November 2003 that Scrushy's repayment of the $25 million loan with HealthSouth stock was insufficient because the stock price was overvalued. The value of HealthSouth stock plummeted after disclosure that the company had overstated earnings.
Separately, HealthSouth announced it would sell HealthSouth Medical Center, Birmingham, to the University of Alabama-Birmingham Health System for $33 million, contingent on regulatory approval. UAB is expected to take over management of the hospital Aug. 1. The companies entered exclusive negotiations over the hospital in April. -- by Joseph Mantone