Alpha Financial Solutions Sues Wheeling Hospital for Breach - Business, Government Legal News from throughout WV

Alpha Financial Solutions Sues Wheeling Hospital for Contract Breach

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A Pennsylvania-based billing and data processing business is seeking more than $1.6 million in damages against a Northern Panhandle hospital, alleging breach of contract.

Alpha Financial Solutions filed the federal suit Feb. 3 against Wheeling Hospital. According to the suit, Alpha had provided Wheeling Hospital with data processing, billing and management services since 2003.

The suit claims hospital officials informed Alpha management that the processing agreement would be terminated Feb. 1 but did not provide Alpha with written notice of a breach in the agreement.

Alpha claimed the hospital must provide such written notice and give Alpha 30 days to fix problems.  

The suit claimed the hospital informed Alpha of its intentions to purchase Alpha's computer hardware and software in other December meetings.

"Wheeling Hospital ‘imaged' the software and other intellectual property on the computers Alpha uses to provide billing services to Wheeling Hospital," the suit states, noting Alpha's claim that the hospital transferred software images to the hospital's computer servers.

"Wheeling Hospital planned to utilize that software and other intellectual property in order to perform billing services on its own behalf after improperly terminating Alpha," the suit states.

The suit also claims issue with Wheeling Hospital for soliciting Alpha's employees. Alpha claimed Lou Longo, a hospital employee, informed Alpha's workers of the termination of the agreement and told workers Alpha would be out of business within a month.

"In an attempt to circumvent the restrictions of the processing agreement… Lou Longo told Alpha's employees that they should continue to work for Alpha for a couple more weeks and then they should quit their jobs," the suit states. "Lou Longo told Alpha's employees that Wheeling Hospital would then hire them as employees."

Alpha claims Wheeling Hospital passed out applications to Alpha workers, encouraging them "to fill them out on the spot."

"In other words, Wheeling Hospital had Alpha's employees fill out employment applications with Wheeling Hospital while ‘on the clock' with Alpha," the suit states.

On Feb. 1, Alpha's management was excluded from the hospital's Stratford building, and management informed Alpha that the lease agreement was terminated, the suit states. Alpha claims Wheeling did not give required notice of the non-renewal of the lease agreement.

"The same day, 20 of Alpha's 24 employees in Wheeling quit en masse and started working for Wheeling Hospital," the suit states, noting Alpha has four employees left.

"Wheeling Hospital and Alpha's former employees are performing billing services using Alpha's hardware, software, telephone systems and even office furniture," the suit states.

The suit claims the hospital did not have the authority to take Alpha's computers, which Alpha claimed contains protected health information unrelated to Wheeling Hospital.

"Not only has Wheeling Hospital's seizure of those servers crippled Alpha's ability to serve those other customers, Wheeling Hospital has seized federally-protected PHI (Protected Health Information) that it has absolutely no right to possess," the suit states.

The case has been assigned to U.S. District Judge Frederick P. Stamp Jr. Wheeling Hospital has not yet filed a response.

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