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Arizona jury awards $27 million to healthcare staffing company owner after partner ousts him for investigating fraud

Company founder alleged his partner led fraud scheme involving submission of false bills to the government, then tried to get rid of him.

Beth Jones Sanborn, Managing Editor

A federal jury in Arizona has awarded $27.6 million to Marc A. Wichansky, former president and co-owner of Zoel Holding Co. in Phoenix, including more than $14 million in punitive damages against his former business partner David T. Zowine, Wichansky's lawyer Sean Callagy announced Monday.

The verdict comes after a 13-day trial in which Wichansky alleged Zowine, who was at the time the company vice-president and co-owner, led a retaliation campaign against him for investigating a suspected fraud scheme Zowine was involved in.

Callagy said the dispute broke out in 2011, when Wichansky claimed irregular billing practices had led a Zoel subsidiary called MGA Home Healthcare to submit false bills to the government and government payers. Wichansky further alleged the practices were part of a fraud scheme by Zowine and other employees, and that Zowine tried to squelch his internal investigation into the suspected fraud and oust him from the company they co-owned.

[Also: Aetna awarded $37.4 million in lawsuit against Bay Area Surgical Management]

Zowine's retaliation campaign also included verbal abuse and physical assault, Callagy said. The details of Wichansky's complaint alleged Zowine at one point grabbed him by the neck, threw him across the room, and punched him. It also discussed verbal and written abuse, threats and verbal disparagement in front of employees that Wichansky suffered as a result of the retaliation. Callagy also said the complaint alleges Zowine and his co-conspirators stole and accessed Zoel's server and computers and set up a secret satellite office.

When Wichansky tried to fire Zowine, an Arizona state court initially told him he didn't have the power to do so, and also ruled that Zowine could buy Wichansky's shares, his lawyer said. Wichansky asserted that he had incurred damages as result of this sale.

[Also: Dallas doctor convicted in landmark $375 million fraud case, largest ever in home health]

In addition to breach of officer, director and shareholder fiduciary duty, the jury also found that Wichansky was assaulted and battered by Zowine. They also awarded compensatory and punitive damages against several other defendants who were involved with Zowine's breach of fiduciary duty totaling roughly $2.25 million.

Twitter: @BethJSanborn

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