The Alabama Supreme Court upheld a $2.9 billion judgment against imprisoned HealthSouth Corp. founder Richard Scrushy on Friday, rejecting claims that he shouldn't have to pay for the fraud that nearly wrecked the rehabilitation company.
Court upholds $2.9 billion verdict in HealthSouth case
The 7-0 decision, in which two justices didn't participate without explanation, means shareholder attorneys can continue trying to locate and collect the remains of Scrushy's once-vast estate, which included three mansions and a 92-foot yacht.
Lawyers already have confiscated about $100 million worth of Scrushy's cash, homes, farms, luxury cars, jewelry, aircraft, boats and other property.
“We've already seized all his assets we could identify, and we continue to look on,” said shareholder lawyer John Haley. “In late March we're going to just have a big yard sale. We have three or four boats still for sale.”
Lawyers for Scrushy did not immediately return messages seeking comment.
Scrushy was acquitted on criminal charges in the HealthSouth fraud in 2005, but he and former Alabama Gov. Don Siegelman were convicted in a separate bribery scheme the next year. Scrushy is serving a nearly seven-year sentence in a federal prison in Texas.
With Scrushy already behind bars, a Jefferson County, Ala., judge ruled in a civil suit in 2009 that he was the “CEO of the fraud” at HealthSouth and ordered him to pay $2.9 billion in compensatory damages, one of the largest verdicts in Alabama history.
Scrushy appealed on several grounds, arguing that the judge considered improper evidence; that the shareholders' claims were too old to try; that other courts already had ruled on the allegations; and that the state judge lacked jurisdiction to consider the lawsuit.
The justices rejected each of Scrushy's arguments, allowing the verdict to remain intact.
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