Federal Judge Harold Murphy has ruled that Hutcheson Medical Center must turn over disputed emails and documents to Erlanger Health System.
The Rome, Ga., judge, in a 42-page opinion settling the hard-fought issue, said it was not necessary for him to examine the items "in camera."
He noted that some of the documents had been shared with other parties involved in the negotiations for Erlanger to help out the financially-ailing Fort Oglethorpe Hospital.
Also, the then-Hutcheson attorney, Ward Nelson of Miller and Martin, sent some of the emails to Erlanger by blind carbon copy.
Judge Murphy, in a separate 53-page order, denied a request that Hutcheson amend its counter-claim against Erlanger based on the issue of the emails and documents.
He ruled out any RICO (Racketeer Influenced and Corrupt Organizations Act) or punitive damage claims by Hutcheson against Erlanger.
Erlanger is trying to recoup over $20 million it spent to help bail out Hutcheson, which later went into bankruptcy.
Hutcheson filed a counter-suit, claiming that Erlanger failed to deliver on promises made to Hutcheson.
Attorneys for Erlanger earlier said Hutcheson lawyers have "resorted to desperate tactics" in "desiring to escape from a $20 million debt without paying a cent."
Erlanger said in the process Hutcheson had "publicly sullied the reputation of a well-respected attorney at Miller & Martin."
Erlanger had asked that Judge Murphy should not to allow Hutcheson to amend its counter-claim.
Hutcheson had claimed it recently learned that attorney Nelson, while representing Hutcheson, had shared confidential emails with Erlanger officials.
Erlanger said Hutcheson has had the emails in question for some six months and said they are "mostly non-remarkable" and did not give Erlanger any advantage.
The Erlanger motion says Hutcheson's "penchant for hyperbole and unfounded accusations against Erlanger is nothing new. Its willingness to plead, and peddle to the media, various fictions to tarnish a business partner that saved it from immediate financial collapse in 2011 has become its standard operating procedure."
It says Hutcheson attorneys "have been doing increasingly desperate things" and it had "taken those acts of desperation from the frustrating to the truly offensive."
The motion says, "Respectfully, Erlanger asks the Court not to allow this lawsuit to metastasize beyond its already unwieldy mass. HMC's proposed claims are dilatory, factually implausible, improperly pled, and legally deficient."
Hutcheson earlier claimed that it recently found that its own attorney in 2011 "was secretly and repeatedly sharing HMC's privileged and confidential information with Erlanger negotiators."
Hutcheson said attorney Nelson "breached his professional and fiduciary obligations."
Hutcheson attorneys said, "The new information that has come to light is nothing short of remarkable."
The filing says, "As a result, Erlanger was able to secretly conspire with Miller & Martin to steer HMC towards execution of a series of contracts that are highly favorable to Erlanger – because, for example, they gave Erlanger the right as manager of Hutcheson Medical Center to borrow funds from itself that, if not repaid, would trigger Erlanger’s purported right to foreclose on the Hospital property.
"Moreover, the Deed to Secure Debt drafted by Miller & Martin over-collateralized the Line of Credit Note, by including the Hutcheson nursing home in addition to the main campus – a multi-million dollar windfall for Erlanger, directly attributable to its secret communications with HMC’s lawyers.
"In the aftermath, in an apparent quid pro quo, Erlanger has since engaged Miller & Martin to defend its interests in other matters including a currently pending discrimination lawsuit filed by Erlanger’s former CEO in Hamilton County, Tennessee.
"Needless to say, this new evidence of fraud, conspiracy, and fiduciary and attorney misconduct procured by Erlanger and arising out of the same series of transactions and occurrences underlying both Erlanger’s and HMC’s existing claims in this lawsuit, gives rise to new allegations and causes of action that must be added to HMC’s pleading in order for this matter to be fully and fairly adjudicated on its merits. These new allegations, and the required amended pleading, are the primary purpose of this Motion.
"After HMC filed its original Motion to Amend, Erlanger filed a Motion to Compel in which it attempts to downplay the significance of the secret blind carbon copy communications from Miller & Martin to Erlanger."