An old saying urges lawyers to argue the law if the facts are against their case and argue the facts if the law is against it. Christi Sulzbachs lawyer says the government cant argue either against his client.
The U.S. Justice Department last week filed a False Claims Act lawsuit against Sulzbach, the former general counsel and chief compliance officer for Tenet Healthcare Corp., Dallas. The lawsuit, filed in U.S. District Court in Miami, accuses Sulzbach of falsely certifying to HHS in 1997 and 1998 that Tenet was in compliance with all Medicare regulations. The certifications were made under a settlement and corporate integrity agreement that Tenets predecessor, National Medical Enterprises, signed in 1994. Sulzbach, the lawsuit alleges, made those certifications even though she knew the companys North Ridge Medical Center, Fort Lauderdale, Fla., had entered into physician contracts that violated Stark self-referral laws.
As a general matter, we were both surprised and disappointed that the government chose to proceed with the case, said Robert Krakow, Sulzbachs lawyer and co-head of the healthcare and life sciences practice in the Dallas office of Gibson, Dunn & Crutcher. We think its flawed both factually and legally.
Sulzbach left Tenet nearly four years ago, and since then, Tenet is a completely changed company, Tenet spokesman Steven Campanini said.
The North Ridge contracts first came to the governments attention when a whistle-blower filed a lawsuit in May 1997 in Miami. The case hinged on whether the hospital paid fair-market value for buying certain physician practices. The government intervened in the case in 2001, and in 2004, Tenet paid $22.5 million to settle the charges. In Tenets $920 million global settlement with the federal government in 2006, the company agreed to turn over some documents on which it had claimed attorney-client privilege, and some of those documents provide evidence that Sulzbach knew that the contracts were illegal, the government alleges.
The government is not accusing Sulzbach of being a co-conspirator in the fraud, but that she was aware of the fraud and still certified that Tenet was in compliance, said Jay Hardcastle, a healthcare lawyer with Boult, Cummings, Conners & Berry in Nashville. Sulzbach could argue that her interpretation of fair-market value differed from the outside counsels interpretation, so she believed the contracts were in compliance, Hardcastle said.