Arizona healthcare staffing company owner awarded $27m after partner ousts him for investigating fraud
A federal jury in Arizona has awarded $27.6m to Marc A. Wichansky, former president and co-owner of Zoel Holding Co. in Phoenix, including more than $14m in punitive damages against his former business partner, David T. Zowine, Wichansky's lawyer, Sean Callagy, announced on Monday.
The verdict comes after a 13-day trial in which Wichansky alleged Zowine, who was at the time the company vice-president and co-owner, led a retaliation campaign against him for investigating a suspected fraud scheme Zowine was involved in.
Callagy said the dispute broke out in 2011, when Wichansky claimed irregular billing practices had led a Zoel subsidiary called MGA Home Healthcare to submit false bills to the government and government payers. Wichansky further alleged the practices were part of a fraud scheme by Zowine and other employees, and that Zowine tried to crush his internal investigation into the suspected fraud and oust him from the company they co-owned.
Zowine's retaliation campaign also included verbal abuse and physical assault, Callagy said. He also said the complaint alleges Zowine and his co-conspirators stole and accessed Zoel's server and computers and set up a secret satellite office.
When Wichansky tried to fire Zowine, an Arizona state court initially told him he didn't have the power to do so, and also ruled that Zowine could buy Wichansky's shares, his lawyer said. Wichansky asserted that he had incurred damages as result of this sale.
In addition to breach of officer, director and shareholder fiduciary duty, the jury also found that Wichansky was assaulted and battered by Zowine. They also awarded compensatory and punitive damages against several other defendants who were involved with Zowine's breach of fiduciary duty totaling roughly $2.25m.
Original story sourced from Beth Jones Sanborn at Healthcare Finance: http://www.healthcarefinancenews.com/news/arizona-jury-awards-27-million-healthcare-staffing-company-owner-after-partner-ousts-him