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Friday, January 12, 2018 1:00 am

Ex-Lutheran CEO files for suit dismissal

Says CHS has offered no evidence

SHERRY SLATER | The Journal Gazette

Brian Bauer, Lutheran Health Network's former CEO, has filed a motion asking a Tennessee court to throw out a lawsuit that accuses him of breach of contract, defamation and hurting its business dealings.

Bauer argues the court should dismiss the suit filed by Community Health Systems for several reasons, including that the lawsuit offers no specific instances of when Bauer defamed CHS, provides no account of what he supposedly said, and includes no evidence that it lost any money because of interference with business relationships.

And – if all those reasons are rejected – there's still the issue of venue. Bauer argues the Tennessee court isn't the proper place for a case against him because the incidents are alleged to have happened in Indiana. Furthermore, traveling to Tennessee for the case would place an undue burden on Bauer, who has three young children, and the witnesses he'd need to call.

A hearing on Bauer's motion is scheduled for Jan. 25 in the Circuit Court for Williamson County, Tennessee.

Community Health Systems, parent company of Lutheran's network, is based in Franklin, Tennessee. Its lawsuit was filed against Bauer and up to five John Does using the alias “Sajin Young” on Facebook.

Bauer is represented by attorneys with the Nashville, Tennessee, firm Neal & Harwell and the Chicago firm Quinn Emanuel Urquhart & Sullivan. Their filing refers to 42 assorted court decisions that, they claim, supports their arguments.

CHS filed its original lawsuit against Bauer on Nov. 2 and followed with an amended complaint Dec. 27. CHS spokeswoman Tomi Galin noted that Bauer's Dec. 6 motion to dismiss doesn't address information included in CHS's later filing.

“We believe Mr. Bauer's actions have harmed Lutheran Health Network, and we look forward to a full airing of the facts as this litigation proceeds,” she said Thursday in an email. 

CHS's second filing accuses Bauer of engaging in “a long-planned scheme” to drive down the network's value to force a sale. The lawsuit says Bauer traveled to Wisconsin and pitched Lutheran's network to officials at privately held retailer Menard Inc.

After that effort failed, the filing said, Bauer was the mastermind behind the efforts of 10 local physicians to persuade parent company CHS to sell Lutheran Health Network to a New York private equity firm approved by the doctors. CHS rejected the $2.4 billion buyout offer in May.

Bauer, who last week denied CHS's amended allegations to The Journal Gazette, was fired from his positions as CEO of the network and of Lutheran Hospital on June 12.

Bauer's filing accuses CHS of trying to sabotage his relationship with his current employer, IU Health, and improperly stifle competition from IU Health in the local marketplace.

Among the allegations against Bauer, CHS says he shared confidential information with IU Health in violation of CHS' stock option agreement. The lawsuit contends that Bauer is subject to the agreement's confidentiality and non-disparagement clauses because from 2012 to 2014, Bauer cashed in 3,000 stock options for a total profit of more than $74,000.

The lawsuit says Bauer and his allies have spread untrue stories about quality problems at Lutheran network hospitals, attempted to intimidate CHS officials, and threatened to interfere with the network's daily operations. 

Bauer's motion to dismiss says CHS hasn't backed up those allegations with proof of any words he supposedly said or specific business relationship he supposedly damaged.

The filing says CHS doesn't “identify a single employee, customer or patient (out of hundreds of thousands) who supposedly severed ties with plaintiff as a result of Mr. Bauer's alleged conduct.”

sslater@jg.net