Receiver's Motion to Approve Medical Accounts Receivable Collection Agreement with Thomas ...

105 Pages·2015·0.94 MB·English

Filing # 23652383 E-Filed 02/11/2015 03:38:31 PM
IN THE CIRCUIT COURT OF THE SIXTH JUDICIAL CIRCUIT
IN AND FOR PINELLAS COUNTY,F LORIDA
CIVIL DIVISION
STATE OF FLORIDA,
OFFICE OF FINANCIAL REGULATION,
Plaintiff,
vs. Case No.: 14-001695-CI
TRI-MED CORPORATION,
TRI-MED ASSOCIATES INC.,
JEREMY ANDERSON,
ANTHONY N. NICHOLAS,I II,
ERIC AGER,I RWIN AGER,
TERESA SIMMONS BORDINAT
a/k/a TERESA SIMMONS,
and ANTHONY N. NICHOLAS, JR.,
Defendants,
TMFL HOLDINGS, LLC,
Relief Defendant.
/
RECEIVER'S MOTION TO APPROVE MEDICAL ACCOUNTS RECEIVABLE
COLLECTION AGREEMENT WITH THOMAS CAREY,J .D., LLM.,P .A.
Burton W. Wiand, as Receiver (the "Receiver) for Tri-Med Corporation ("Tri-Med");
Tri-Med Associates Inc.; and TMFL Holdings, LLC (collectively, the "Receivership Entities"),
moves the Court to approve the attached agreement (the "Agreement') with Thomas Carey,
J.D., LLM., P.A.( "Mr. Carey"), which retains Mr. Carey and his firm to negotiate and collect
medical accounts receivable subject to Letters of Protection ("LOPs")I which are owned by
Receivership Entities. A copy of the Agreement is attached as Exhibit A, and as detailed below
LOPs essentially are contracts involving a patient, the patient's attorney, and the medical
services provider under which the patient and attorney agree to pay for medical services from the
proceeds of any pre-suit or lawsuit settlement or judgment the patient may obtain.
Mr. Carey and his firm have significant experience with both (1) personal injury cases and (2)
negotiating and collecting payments under LOPs.
Although Defendants operated a fraudulent investment scheme, they appeared to have
used approximately $4 million of the approximately $17 million raised from investors to actually
buy LOPs, although that figure represents a "best case scenario" and includes fake and other
problematic LOPs. The Agreement provides a cost-efficient way for negotiating and collecting
LOPs on favorable terms to the Receivership Estate.
BACKGROUND
1. As the Court observed after a day-long evidentiary hearing on October 22, 2014,
there is abundant evidence that Defendants, through the Receivership Entities, operated a
fraudulent investment scheme involving the purported purchase of LOPs. Although Defendants
raised approximately $17 million from investors, at most only approximately $4 million of those
funds were actually used to buy LOPs.
2. Since the Receiver's appointment, his team has been handling the negotiation and
collection of LOPs while also thoroughly investigating the Receivership Entities' LOPs. As
previously reported, the Receiver's investigation revealed a number of problems with many
LOPs. While the fact that Tri-Med is in receivership has given the Receiver's team leverage to
negotiate favorable resolutions of LOPs — often recovering 100% of the LOP's face value despite
industry averages that are significantly below that sum — such efforts require a significant
amount of time and effort.
3. Recognizing that, and to further benefit the Receivership estate, the Receiver
explored entering into an arrangement with a third party, including Mr. Carey and his firm, to
handle the administration, negotiation, and collection of LOPs currently owned by the
2
Receivership Entities.2 Several of these third parties indicated that they would enter into such an
arrangement only if they would receive as a fee a minimum percentage of at least 10% to 15% of
the collected amount of the LOPs. As discussed below, however, Mr. Carey agreed to perform
these services on more favorable terms to the Receivership. The Receiver and Mr. Carey entered
into the Agreement on February 6, 2015.
4. Mr. Carey's experience both as a Florida personal injury attorney and in the
business of purchasing and negotiating LOPs makes him highly qualified to handle the
negotiation of LOPs for Receivership Entities. Mr. Carey has been a licensed Florida attorney
for nearly forty years, and is a founding partner of the Clearwater law firm of Carey & Leisure
where he practices primarily in the field of personal injury law. Mr. Carey is board certified in
civil trial law by both the Florida Bar and the National Board of Trial Advocacy and is AV-rated
by Martindale-Hubbell. He has handled more than 50,000 personal injury cases over the course
of his career. This experience has allowed Mr. Carey to develop an extensive knowledge and
understanding of both the valuation of personal injury cases and the medical costs and expenses
associated with those cases.
5. Notably, Mr. Carey has used his substantial knowledge in personal injury law to
develop significant expertise in the purchase and negotiation of LOPs. Specifically, for the past
four years, Mr. Carey has been a principal in several companies focused on the business of
purchasing receivables from medical service providers, including Thomas Carey, J.D., LLM,
P.A. Currently, Mr. Carey and his companies own LOPs with a face value of more than $20
2 Before this Receivership, Tri-Med spent approximately $2.37 million of the
approximately $4 million of LOPs purchased to buy LOPs from Florida Surgery Consultants,
LLC ("FSC") and its related entities, and the agreement with FSC provides a guaranteed payout
to Tri-Med of either 50% or 55% of an LOP's face value, depending on the medical procedure.
Accordingly, Mr. Carey will not be negotiating the FSC LOPs as there is no need to do so.
3
million, and he is personally involved in the underwriting and acquisition of those LOPs and also
has oversight over the negotiation and resolution process by his staff.
6. Further still, Mr. Carey and his partner, Robert Shuttera, Esq., also an experienced
personal injury lawyer who is AV-rated by Martindale-Hubbell, evaluate approximately 200
cases per month for various companies that specialize in loans, acquisition, or investment in
personal injury cases.
7. Messrs. Carey's and Shuttera's significant experience with personal injury
litigation and LOPs has allowed them to become intimately familiar and knowledgeable about
the collection and negotiation of LOPs and to develop extensive relationships with personal
injury attorneys throughout West Florida. In short, Mr. Carey and his team are highly qualified
to negotiate and collect the LOPs owned by Receivership Entities.
The Agreement
8. The Agreement provides that, for an initial two-year term, Mr. Carey will act as
the Receiver's agent and representative in connection with the negotiation and collection of
approximately 2,100 LOPs with a best-case-scenario face value of roughly $6.5 million. A
complete list of the LOPs that would be covered by the Agreement and the apparent
corresponding issuing attorneys is attached to the Agreement as "Exhibit A." The Agreement
contains multiple mechanisms to ensure the highest possible recovery rate for those LOPs. For
example, Mr. Carey will be required to receive written approval from the Receiver to finalize
any LOP settlement for less than 80% of the corresponding face value, while any settlement
offers at or above 80% of the corresponding LOP face value will not require authorization from
the Receiver. Additionally, Mr. Carey will provide the Receiver with a written report each
4
month detailing his efforts, the status of negotiations, and the amount of collected settlements for
the immediately preceding month.
9. Mr. Carey will be compensated in the amount of 5% of the gross settlement
amount of each negotiated LOP. Given that, as noted above, the Receiver was advised by
competing entities in the medical accounts receivable purchasing business that their required
compensation would be higher than 5% of each settled LOP, the Receiver believes that Mr.
Carey's compensation is not only favorable to the Receivership but also adequately factors in the
amount of attorney time required for the negotiation and collection of LOPs. More importantly,
this arrangement will no longer require the Receiver's team to incur additional time or resources
in LOP negotiation and collection efforts. Further, by structuring the compensation arrangement
on the amount of settled LOPs, Mr. Carey's compensation will be directly tied to the amount of
settled LOPs he is able to negotiate.
10. The Agreement also provides that Mr. Carey will initially handle any interpleader
proceedings in the event that negotiation of an LOP is unsuccessful. Under the Agreement, Mr.
Carey agrees to the expenditure of two (2) attorney hours towards defense and maintenance of
interpleader suits, including the filing of an answer and any required court appearances. Any
additional required time will be provided to the Receiver in a written estimate and ultimately
subject to the Receiver's approval at a rate of $250 per hour. The Receiver is not required to
accept this estimate, and may proceed with or without Mr. Carey's assistance in an interpleader
proceeding as the Receiver concludes is in the best interests of the Receivership estate.
11. Finally, the Agreement contains appropriate safeguards to ensure the
confidentiality of patient information provided by the Receiver to Mr. Carey, and obligates Mr.
5
Carey to comply with all rules and regulations under the Health Insurance Portability and
Accountability Act.
12. It is well established that the court which appoints a receiver may issue orders as
are necessary and proper for the property and interests of those concerned. City ofK issimmee v.
Dept ofE nvtl. Regulation, 753 So. 2d 770, 772 (Fla. 5th DCA 2000); see also Puma Enterprises
Corp. v. Vitale, 566 So. 2d 1343, 1345 (Fla. Dist. Ct. App. 1990) ("[T]he court making the
appointment [of a receiver] may, at its discretion, during the pendency of the action make such
further orders as are necessary and proper for the protection of the property and interests
concerned.").
13. Here, the Agreement is in the best interests of, and is necessary and proper for, the
Receivership and defrauded investors because it places negotiation and collection of LOPs in the
hands of a highly experienced and successful person at a favorable rate to the Receivership.
WHEREFORE, the Receiver respectfully requests that the Court enter an Order
approving the Agreement and for any other relief the Court deems just and proper.
CERTIFICATION OF OFR'S NON-OBJECTION TO REQUESTED RELIEF
Undersigned counsel for the Receiver has communicated with counsel for OFR and is
authorized to represent to this Court that OFR has no objection to entry of an Order granting the
relief sought in this Motion.
6
s/ Gianluca Morello
Gianluca Morello, FBN 034997
[email protected]
Michael S. Lamont, FBN 0527122
[email protected]
WIAND GUERRA KING P.L.
5505 West Gray Street
Tampa, FL 33609
Tel.: [phone]
Fax: [phone]
Attorneysf or Burton W. Wiand, as Receiverf or Tri-
Med Corporation, Tri-Med Associates Inc. and
TMFL Holdings, LLC
7
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on February 11, 2015, I electronically filed a true and
correct copy of the foregoing with the Clerk of the Court by using the Florida Courts E-Filing
Portal, which served the following parties and non-parties:
Douglas Holcomb, Esq. Edwin B. Kagan, Esq.
Office of Financial Regulation Edwin B. Kagan, P.A.
400 West Robinson Street, Suite S225 2709 North Rocky Point Drive
Orlando, FL 32801 Suite 102
Primary Email: [email protected] Tampa, FL 33607
Attorneyf or PlaintiffS tate ofF lorida, Primary Email: [email protected]
Office ofF inancial Regulation Secondary Email: [email protected]
Attorney for Defendant Teresa Simmons
A. Gregory Melchior, Esq. Bordinat
Assistant General Counsel
Office of Financial Regulation Anthony N. Nicholas, Jr.
1313 Tampa Street, Suite 615 [email protected]
Tampa, FL 33602-3394 Pro Se Defendant
Primary Email: [email protected]
Secondary Email: Anthony N. Nicholas, III
[email protected] [email protected]
Attorneyf or PlaintiffS tate ofF lorida, Pro Se Defendant
*Office ofF inancial Regulation
Jeremy Anderson
Luke Lirot, Esq. [email protected]
LUKE CHARLES LIROT, P.A. Pro Se Defendant
2240 Belleair Road, Suite 190
Clearwater, FL 33764 John A. Anthony, Esq.
Primary Email: [email protected] Antony & Partners, LLC
Secondary Email: [email protected] 201 North Franklin Street, Suite 2800
Secondary Email: [email protected] Tampa, FL 33602
Attorneyf or Defendants Eric Ager and Irwin Primary Email:
Ager [email protected]
Secondary Email:
Thomas C. Little, Esq. [email protected]
THOMAS C. LITTLE, P.A. [email protected]
2123 NE Coachman Road, Suite A Attorneys for Certain Non-Party
Clearwater, FL 33765 Unaffiliated Creditors
Primary Email:
[email protected]
Secondary Email:
[email protected]
Attorneyf or Defendants Eric Ager and Irwin
Ager
8
Eric D. Jacobs, Esq.
Jennis & Bowen, P.L.
400 North Ashley Drive
Suite 2540
Tampa, FL 33602
Primary Email: mpalmerA ennisbowen.com
Secondary Email:
eserviceA ennisbowen.com
[email protected]
Attorneyf or Non-Party A.J. Brent
s/Gianluca Morello
Gianluca Morello, FBN 034997
Filing # 23652383 E-Filed 02/11/2015 03:38:31 PM
Exhibit A