At 10:30 the Court will hear Wellness, Inc. v. Pearl River County Hospital which is an appeal from a court order denying arbitration.
Wellness is a company that provides “modular-type rooms that are typically installed in existing hospitals to make them more aesthetically pleasing, increase patient satisfaction and increase patient safety among other things.” Wellness and PRCH entered into an agreement to retrofit twelve rooms in the Hospital with Wellness’ patented room system. According to Wellness, when new Board Members were appointed to the hospital in 2012 they stopped work on the contract and sued Wellness for fraud, conspiracy, breach of contract, etc. In October 2014, Wellness moved to compel mediation and arbitration. The Hospital denied that there was any agreement to arbitrate, because there was no agreement at all with Wellness. The Hospital claims that Wellness defrauded it and “caused the Hospital to receive overpayments from Medicare totaling at least $2.9 million, all of which will have to be repaid to the federal government.” According to the Hospital’s statement regardiong oral argument, the case “presents some relatively obscure federal case law.” I assume this has to do with Medicare reimbursements – correction – my sources say this has to do with exceptions to Prima Paint. So, if you are interested in arbitration or you represent governmental agencies, this one’s for you. Party on.
Pearl River County Hospital’s brief
Wellness’s reply brief
Watch the argument here