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Primary Care Providers Win Challenge of CMS Interpretation of Enhanced Payment Law

With the help and support of the Tennessee Medical Association, 21 Tennessee physicians of underserved communities joined together and retained Bass, Berry & Sims to file suit against the Centers for Medicare & Medicaid Services to stop improper collection efforts. Our team, led by David King, was successful in halting efforts to recoup TennCare payments that were used legitimately to expand services in communities that needed them. Read more

Tennessee Medical Association & Bass, Berry & Sims

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Healthcare Transactions: Year in Review 2018Last year, CVS Health Corp. (NYSE: CVS) announced it would purchase health insurer Aetna Inc. (NYSE: AET) for $67.5 billion, a transaction that would be one of the biggest healthcare mergers in the past decade. The transaction raises an intriguing question: is this the beginning of a transformational shift in healthcare?

Recently, members of our healthcare group authored the Healthcare Transactions: Year in Review outlining 2017 M&A activity and drivers in the following hot healthcare sectors:

• Managed Care
• Hospitals
• Post-Acute Care—Home Health & Hospice
• Ambulatory Surgery Centers (ASCs)
• Healthcare Information Technology (HIT)
• Behavioral Health
• Physician Practice Management

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Chris Lazarini Analyzes Contractual v. Fiduciary Obligations

Securities Litigation Commentator

Publications

July 5, 2017

Bass, Berry & Sims attorney Chris Lazarini analyzed a case in which plaintiff claimed breach of contract when her investment advisor did not transfer funds in a timely manner. The trial court and court of appeals awarded summary judgment against plaintiff, stating the obligation to timely transfer funds was a fiduciary one, not a contractual one. The Arkansas Supreme Court disagreed, finding the transfer obligation a material contractual undertaking, and remanded to the trial court.

Chris provided the analysis for Securities Litigation Commentator (SLC). The full text of the analysis is below and used with permission from the publication. If you would like to receive additional content from the SLC, please visit the SLC website to sign up for the newsletter.

Farris vs. Conger & Conger Wealth Management, No. CV-16-430 (Ark. Sup. Ct., 3/9/17) 

Whether a cause of action sounds in contract or negligence depends on the "gist" of the action. 

Plaintiff was an advisory client of Conger Wealth Management ("CWM"). In its Wealth Management Agreement, CWM stated: "We shall endeavor to process all Account transactions in a timely manner, but do not represent or warrant that any such transaction shall be processed or effected by the Broker-Dealer on the same day as requested." In 2008, Plaintiff arranged to buy a five-acre tract of land out of foreclosure, and directed CWM to transfer funds from her investment account to her bank account prior to the scheduled closing. The transfer was not timely made, and Plaintiff had to spend additional funds to secure the property.

In 2013, Plaintiff filed a "breach of contract" complaint, alleging that CWM's failure to timely transfer funds forced her to "liquidate" her investment account for the additional funds to buy the property. She claimed that her account would have been worth $127,000, but for the forced liquidation. CWM moved to dismiss and for summary judgment, arguing that the complaint was barred by the three-year statute of limitations for negligence claims. Plaintiff countered that the complaint was timely under the five-year statute for breach of contract claims. Granting summary judgment for CWM, the trial court found that the transfer of funds was not a material part of the contract and that the obligation to act timely was a fiduciary one, not a contractual one, subject to the three-year negligence statute. The court of appeals affirmed.

Not giving up, Plaintiff appealed to the Arkansas Supreme Court. The Court explains that it must examine the facts alleged to determine the "gist" of the action and disagrees with the lower courts, finding that the obligation to timely process transactions is a specific, material contractual undertaking, which Defendant allegedly breached. The Court reverses and remands to the trial court. 

Writing in dissent, the Chief Justice highlights Plaintiff’s "proximate cause" allegation and cites a prior Court decision, where a law firm undertook to "proceed diligently" in representing its client. When the client sued for malpractice, the Court held that the obligation to act diligently is present in every lawyer-client relationship, and the violation of that obligation is, by definition, nothing more than negligence. The Chief Justice sees no difference in the scenarios.


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