Marcus Neiman & Rashbaum lawyers represented three physicians whose ownership shares were undervalued by their Miami hospital following a merger. Michael Pineiro and Daniel Rashbaum represented the plaintiffs in Miami-Dade Circuit Court. Judge Jorge Cueto found that Kendall Regional Medical Center undervalued the plaintiffs’ limited partnership shares by $11.6 million.
Back in 1991, doctors Rafael Madrigal, Juan Suarez and Jorge Suarez-Menendez committed to Class-A ownership interests at $15,000 each. During the trial, Judge Cueto accepted the estimate of a valuation expert who said those shares are now worth more than $3 million apiece.
Kendall merged with Hospital Corp. of America Inc. and the center prospered. Pineiro, however, claimed that prior to the merger Kendall created “paper merger” in which the general partner of the limited partnership created a shell company with no assets or business. The shell company merged with Kendall Healthcare Group Ltd., which changed nothing about the company except removing the doctors as limited partners.
“You cannot squeeze out or freeze out shareholders — in this case, limited partners — for the sole purpose of removing them and without a legitimate business reason, and that’s what happened here,” he said.
The lawsuit names Kendall Healthcare Group and the general partner, Columbia Hospital Corp. of Kendall, as defendants.
“We believe we offered fair value and are therefore disappointed with the ruling,” Kendall Regional said in a statement. “We have filed a notice of appeal.”
The hospital was represented by Miami attorneys Walter Tache and Marissel Descalzo of Tache, Bronis, Christianson and Descalzo and Yolanda Strader of Carlton Fields.