Carrie Rengers

Medical practice wins more than $3.5 million in damages against two former presidents

The physician shareholders of Mid-Continent Anesthesiology have prevailed in their lawsuit against two former presidents of the corporation.

A jury found that defendants Gerard Bassell and Robert McKay, physicians and former presidents, didn’t disclose compensation they received or give satisfactory evidence that the compensation was fair and taken in good faith.

The jury said Bassell and McKay conspired to misappropriate more than $3.5 million, which has been awarded to the practice.

“Juries very seldom give you every penny you ask for,” says Randy Rathbun, Mid-Continent’s attorney.

“It was a hard-fought trial,” he says.

And there will be more to come, says Jay Fowler, Bassell’s attorney.

“We were disappointed in the verdict,” Fowler says. “Substantial legal issues need to be addressed on appeal.”

John Gibson, who represented McKay, didn’t return calls for comment.

Mid-Continent provides services at Wesley Medical Center’s obstetric suite and previously also provided services to Surgicare of Wichita.

Rathbun says it was when Mid-Continent was ceasing to do business at Surgicare that a review of the practice’s budget showed issues with what Bassell and McKay had been paid.

“The budget wouldn’t work,” Rathbun says. “But for that, I don’t know that anybody would have ever found this out.”

He says Bassell and McKay breached fiduciary duty by not disclosing what they were taking. He says they also did things such as moving people on and off the board without them knowing it.

“They just kind of began to more and more just forget including their shareholders and . . . other directors and just started running things themselves,” Rathbun says.

“The company was very successful for 31 years,” Fowler says. “They did business in the same way for 31 years.”

He says it was only years later that there was a complaint “essentially arguing it should have been done differently. That’s the guts of what this was all about.”

“It wasn’t like it was OK for 31 years,” Rathbun says. “Nobody knew what they were doing.”

Fowler will have more to share upon appeal.

“Check back in a year.”

Carrie Rengers has been a reporter for almost three decades, including 16 years at The Wichita Eagle. Her Have You Heard? column of business scoops runs five days a week in The Eagle. If you have a tip, please e-mail or tweet her or call 316-268-6340.
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