Hospital Shareholders Continue Legal Struggle

July 27, 2007

A binational legal dispute among shareholders of the Hospital CIMA San José shows no signs of slowing.

Consorcio Hospitalario Internacional, S.A. (CHI), the majority shareholder in CIMA, has accused minority shareholder Grupo Promotor Hospital San José, S.A. (GP), which used to play a larger role in the private hospital’s operations, of mismanagement, as The Tico Times reported earlier this year (TT, Feb. 2). However, Francisco González of Grupo Promotor – whose representatives did not return phone calls for the earlier story – recently told The Tico Times that CHI’s claims are false, and his company plans to sue for defamation.

Dallas-based International Hospital Corporation (IHC), which owns majority CIMA shareholder CHI, also filed suit against Grupo Promotor in U.S. district court last year. During a previous interview with The Tico Times, hospital CEO Carole Veloso explained during the early years of the two companies’ collaboration, many of the meetings and agreements took place in Dallas, making a U.S. suit as well as a suit in Costa Rica necessary.

In March, according to a copy of court documents provided by González,U.S. Judge David C. Godbey granted Grupo Promotor’s motion to dismiss the suit, stating that the U.S. court is not the correct forum for the case.

The Hospital Corporation would have the right to reinstate the case “should the Costa Rican courts decline to exercise jurisdiction over this case,” the judgment states.

Asked about the decision, however, Veloso said in an e-mail that the company is still pursuing legal action in the United States.

“The real legal actions are just starting,” she said.

The legal battle has its roots in the early years of the two companies’ collaboration to build CIMA. Grupo Promotor began selling stock in 1996 to raise capital for what would become CIMAHospital; CHI bought 25% of the stock in 1997 and eventually became the majority shareholder. (Grupo Promotor now has less than 1%.) In the interim, however, according to CHI and its parent company, Grupo Promotor personnel mismanaged the project, sold stocks for inflated prices and accepted kickbacks during construction (TT, Feb. 2, 2007).

In a recent interview with The Tico Times, González denied these statements.

He argues that ever since IHC joined the operation, it has been actively involved in  administration at the hospital and was involved in all decisions. González was named the hospital’s director when CIMA opened in 2000, but says he answered to IHC.

“There was never anything they weren’t up to date on,” he said. “They participated in all administrative decisions.”

He claims that cooled relations between the two companies resulted not from Grupo  Promotor mismanagement, but rather because GP began asking CHI for bankaccount details.

Because CHI never provided that information, Grupo Promotor began proceedings at the Arbitration Court of the Costa Rican Chamber of Commerce, which are ongoing, González explained.

Regarding another key IHC claim – that Grupo Promotor misrepresented the amount it had paid for the land on which the hospital now stands – González said the original value of the land was lower, but Grupo Promotor built access roads to the nearby highway, which significantly increased its value.

He also denied IHC’s claim that Grupo Promotor sold CIMA stock for inflated prices, explaining that the company did sell cheaper stock to doctors and other potential assets to the hospital, with higher prices for other buyers. This is a common practice, he asserted.

González also denied Veloso’s claim that Grupo Promotor is using the suits in an attempt to regain control of the now-successful hospital.

Veloso, meanwhile, maintains CHI’s claims are accurate and will stand up in court.

“We have absolute ironclad proof on every claim made in our legal action,” she said.

 

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