Lakin lawyer: Bankrupting a Florida business would stop it from breaching contract

Steve Korris Aug. 17, 2007, 12:00am



U.S. District Judge David Herndon, Tom Lakin's former law partner, has taken under advisement an opportunity to help the Lakin Law Firm destroy a small business.

At an Aug. 16 hearing, Jeff Millar of the Lakin firm asked Herndon to certify a national class action against Integrated Health Plan, a Florida company with 39 employees.

Lakin plaintiffs Richard Coy and Ann Stock claim Integrated Health Plan promised benefits and incentives to health providers but did not deliver.

Integrated Health Plan attorney Michael Kendall of Boston told Herndon the cost of a class action notice alone would bankrupt his client.

Herndon said it was not the role of litigation to put people out of business. He asked Millar to respond.

Millar said Integrated Health Plan presented itself to the court as a small business.

"That is not what you tell people on your website," Millar said.

He said the website describes Integrated Health Plan as one of the top five preferred provider organizations in the nation.

Millar said Integrated Health Plan was able to mount a vigorous defense.

"Just because they claim they no longer have any money doesn't make their misdeeds right," he said.

He said going out of business would be a dire result.

"But if that were to happen, that company would no longer be making those kinds of breach of contracts," Millar said.

He said putting the company out of business would stop the practice.

This caught Herndon's ear, for Millar had said earlier that the lawsuit caused the company to change its contracts.

Herndon said he thought they stopped the practice.

Millar said they did.

In response, Kendall told Herndon he gave audited financial statements to plaintiffs.

Herndon asked what the statements showed. Kendall said they were not part of the record.

Kendall said the owner draws a salary in the low six figures. He said in a moment he could check on her net worth.

"I'm not sure we want that in the public record," Herndon said.

Kendall said Integrated Health Plan offers access to 500,000 providers.

He said the website claim was about the company's reach, not its revenue.

Kendall said nothing in the record shows Integrated Health Plan ever took a discount without providing an incentive or a benefit.

Stock and Coy sued Integrated Health Plan last year in St. Clair County circuit court.

The Lakins filed the suit along with Freed and Weiss, a Chicago firm that had teamed with the Lakins in class actions since 1999.

Integrated Health Plan removed the suit to U.S. district court.

Late last year, the partnership between the Lakins and Freed and Weiss broke down.

Richard Burke left the Lakins and sued them in U.S. district court. He continued his association with Freed and Weiss.

The Lakins sued Freed and Weiss in Madison County, and Freed and Weiss sued the Lakins in Cook County.

For a time Paul Weiss of Freed and Weiss refused to withdraw from class actions he filed with the Lakins.

Weiss withdrew from the Integrated Health Plan suit in May but he reserved the right to seek relief from the Lakins.

At Herndon's hearing, Kendall said he would not get into the details of fighting among counsel.

He asked Herndon to take notice of a default judgment against the Lakins in federal court in Oklahoma.

U.S. District Judge Claire Eagan of Tulsa recently awarded almost $4 million to former Lakin client Stephen Williams.

Lakin attorneys helped Williams win a structured settlement in an injury suit, but payouts stopped when investor James Gibson diverted funds to himself and his businesses.

When Millar and Kendall wrapped up their arguments, Herndon said he would take it under advisement.

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