A company that provides doctors and other medical personnel for Kentucky hospitals and their emergency departments is the target of a class-action lawsuit that alleges fraud and breach of contract.
The suit, filed Thursday in Fayette Circuit Court against Team Health Holdings, says the plaintiff, Lori Wagner, and other Team Health employees were "paid less money than they earned and were entitled to as wages and ... have had other amounts wrongfully withheld from their pay."
The employees affected by the suit originally worked for Mesa Medical Group, but Knoxville-based Team Holdings acquired Mesa in October.
The suit alleges that Mesa improperly converted to its own use more than $2.8 million that should have gone to 254 employees over a three-year period. The suit says Mesa did this for about nine years, so "the total money illicitly taken by Mesa should approximate $9 million."
When Team Health took over, employees were required to sign new contracts for less pay, the lawsuit says.
"Even though Team Health knew the plaintiffs were entitled to money that had been wrongfully withheld and converted by Mesa, it never offered to repay the money to the plaintiffs and sought to take advantage of Mesa's illicit conduct to its own advantage by breaching the contracts with the plaintiffs," the suit says.
A Team Health spokeswoman had no comment, saying the company had not been served with the lawsuit.
Lexington attorney Dale Golden, who filed the class-action suit, has filed two similar lawsuits in recent months against Mesa.
According to court documents, Mesa is accused of forcing employees to pay the employer's share of Federal Insurance Contributions Act, or FICA, taxes.
"Large corporations should pay their own taxes," Golden said. "That's the way it's supposed to be ... And that's mostly what this case is about."
The first of the lawsuits Golden filed was dismissed from U.S. District Court in Lexington after Judge Joseph Hood ruled that the plaintiff, Tammy Berera, should take her complaint to the IRS.
Berera is appealing that decision.
"When we filed this suit, we knew that there were several hundred complainants and we know there are several million dollars at stake," Golden said. "We were not seeking a remedy for a single individual to receive a tax refund that may or may not be recoverable based on the time limitations by the IRS for tax refunds."
The plaintiff in the other lawsuit is Katisha Ednacot, who also was a plaintiff in the Berera case.
The Ednacot suit was moved recently from Boyle Circuit Court to U.S. District Court, and Mesa has made a motion to have the case dismissed, saying it deals with the same issues addressed in Berera's case.
In a filing Friday, however, Ednacot argues that Mesa "knew that it could not pay her or any other employee the contracted-for rate."
"Mesa ... stole from Ednacot's wages under the guise of state and federal payroll taxes and through deductions for bogus cellphones and travel expenses," the filing states. "Indeed, the true scope of Mesa's wage conversion have never been reviewed.
"... There is absolutely no IRS remedy for any of Mesa's wage theft. ... Mesa converted large sums of money for amounts that have no arguable federal tax nexus whatsoever."