Second class-action suit filed against operators of Lexington-based health care firms

vhoneycutt@herald-leader.comOctober 3, 2013 

A second federal class-action lawsuit has been filed against several Lexington-based health care firms, this one contending that employees weren't fully paid.

The lawsuit was filed Wednesday on behalf of an estimated 300 current and former employees against interrelated entities, including Paragon Family Practice and Horizon Healthcare Center LLC, operated by Ann Giles and Lu Anne Wallace.

The lawsuit alleges the health care firm's officials committed "willful and repeated violations of the Fair Labor Standards Act."

An attorney representing the firms in federal court could not be immediately reached Thursday.

In the most recent action, employees Linda Shellhammer and Narda Shipp, and former employee Erin Wilson represent hundreds of others.

In addition to Giles and Wallace, the lawsuit identified 25 "John Doe corporate defendants" whose names are unknown.

The lawsuit said the employees have been paid by numerous corporate entities this year and have been asked to work interchangeably for the various defendants at times, demonstrating the interrelated nature of companies owned and/or managed by Giles and Wallace.

In the August lawsuit, employees alleged that some firms operated by Giles and Wallace caused the company's health insurance plan to lapse by failing to pay premiums. Employees alleged in the previous lawsuit that the defendants withdrew retirement contributions from their paychecks but didn't deposit the money in the employees' 401(k) accounts.

Plaintiffs in the previous lawsuit said that they weren't informed that their insurance had been terminated and that some employees incurred thousands of dollars in medical bills before learning they had no coverage.

The two lawsuits have some of the hundreds of plantiffs in common, said Robert Roark, an attorney representing the employees.

Some employees didn't participate in the 401(k) plan, but they lost wages, and some employees had problems with the retirement plan and their wages, he said. Roark said he would ask the judge to merge the two lawsuits.

The most recent lawsuit asks for unspecified punitive damages.

Among those filing Wednesday's lawsuit is an employees' committee, authorized by U.S. Bankruptcy Court, in a Chapter 11 bankruptcy filed Sept. 3 by a firm called Resources in Healthcare Management, according to the lawsuit.

The committee was authorized to protect the rights of the employees of Resources in Healthcare Management and to protect the creditor rights of the RHM bankruptcy estate, according to wording in the lawsuit filed Wednesday.

RHM said in its bankruptcy filing that it had estimated assets of no more than $50,000 and estimated liabilities of $1 million to $10 million, the Herald-Leader previously reported.

Resources in Healthcare Management estimated that it has 200 to 999 creditors.

RHM is a defendant in the federal class-action lawsuit filed in August but not in the lawsuit filed Wednesday.

Valarie Honeycutt Spears: (859) 231-3409. Twitter: @vhspears.

Lexington Herald-Leader is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service