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Attorneys involved in the lawsuit between Erlanger Health System in Chattanooga and Hutcheson Medical Center in Fort Oglethorpe said they are poring over thousands of pages of documents, and the discovery process is going to take longer than anticipated.
The attorneys earlier were aiming to have discovery completed by Nov. 20.
The new goal is April 2016.
Attorneys, in a joint motion, told Federal Judge Harold Murphy of Rome, Ga., that the original plan was to have the documents produced by July 20, then finish the depositions by the Nov. 20 deadline.
Officials with the Erlanger Health System have initiated formal foreclosure proceedings against Hutcheson Medical Center "as part of the effort to recoup moneys owed to Erlanger pursuant to the management agreement signed three years ago between the two healthcare providers."
Attorneys representing Hutcheson Medical Center said they have responded to a federal lawsuit by filing a counterclaim and a procedural motion "to protect public funds against the lawsuit filed by its former managing hospital Erlanger Health System."
Hutcheson officials said, "The hospitals were in the process of mediating the dispute over Erlanger’s management of Hutcheson when Erlanger surprised Hutcheson with a lawsuit for $550,000 in January and a second suit seeking more than $21 million in February.
Walker County sole commissioner Bebe Heiskell, on Thursday afternoon, signed a contract granting a loan of up to $1 million to the Hospital Authority of Walker, Dade and Catoosa Counties to finance the working capital of Hutcheson Medical Center.
This allocation will pay for indigent care — something required by law — that the Fort Oglethorpe hospital provides county residents, and is not unlike other loans the county has guaranteed over the last few years to Hutcheson.
Erlanger Health System has filed a second lawsuit against Hutcheson Medical Center, this time for payment of $20 million plus interest.
Erlanger filed the suit in U.S. District Court in Rome on Feb. 27, claiming that Hutcheson breached its line of credit.
Hutcheson Medical Center in Fort Oglethorpe is responding to Erlanger’s demands with demands of its own.
Former Georgia governor Roy Barnes, now an attorney with Barnes Law Group in Atlanta, is representing Hutcheson against a lawsuit filed by Erlanger Health System of Chattanooga.
Erlanger, in a lawsuit filed recently, is attempting to recoup loans to Hutcheson.
Erlanger loaned Hutcheson $20 million under a management agreement that began in April 2011 and is now dissolved. Erlanger last year loaned Hutcheson another $550,000 to cover Hutcheson’s operational needs.
Hutcheson Medical Center and its boards of directors announced the hospital will vigorously defend a lawsuit filed last week by Erlanger Health System and "will remain focused on rebuilding a thriving north Georgia community medical center."
Hutcheson officials said, "The damages we have sustained due to Erlanger’s breach of a management agreement far exceed the amount of any line of credit or other debt owed by Hutcheson to Erlanger."
Hutcheson Medical Center in Fort Oglethorpe announced August financial results at the hospital’s board of directors’ budget and finance committee meeting on Sept. 23.
Hospital officials said the hospital’s monthly operating loss was $1.5 million, versus a budgeted gain of $305,146. Year to date, the hospital is $8,611,996 ahead compared to last year.
Hutcheson Medical Center president and CEO Roger Forgey is on loan from Erlanger Health System in Chattanooga as part of a management agreement. Many have credited him with the aggressive recovery of the failing hospital; losing him will be the worst part of cutting ties with Erlanger.
Hutcheson Medical Center had a lot of activity within the last month as the board of directors ended lease talks with Erlanger Health System in Chattanooga and subsequently decided to end its management contract. As a result the monthly board of directors meeting Wednesday night was full of discussion lasting more than three hours.