Diagnostic Open MRI I, LP v. MRI Central, Inc. and Garth F. James
The Plaintiff in this case, Diagnostic Open MRI—a subsidiary of American Health Imaging (AHI)—was a large healthcare services corporation interested in acquiring four scanning centers located in Texas and owned by MRI Central. AHI bought the four scanning centers, but did not maintain them as dictated by the industry. When the centers did not succeed, AHI developed an acute case of buyer’s remorse and sued MRI on the grounds that MRI intentionally withheld critical information about the loss of four top referring doctors at the Houston center—alleging that the loss of the doctors was the reason for the center’s financial decline. They argued that this omission would have ultimately dissuaded them from entering into the Asset Purchase Agreement with MRI and sought to recover damages based on the difference between the “as represented” and the “as received” value of the centers.
The Focal Point’s Role
The Focal Point conducted a Mental Mining session with the client to identify case themes and graphics for opening statement and closing argument. Our graphics played a key role in demonstrating the Plaintiff’s misconception of how the industry actually worked. Contrary to the Plaintiff’s arguments, doctors did not have any allegiance to particular scanning centers, referral turnover was always very high, and new referral sources had to be constantly sought out in order for a scanning center to be successful. Furthermore, the Defendant’s attorney, Jeremy Fielding used the graphics to show: 1) declining scan volumes at the Houston scanning center were not solely attributable to the neurologists’ leaving, 2) MRI Central was diligent in providing all information requested by AHI prior to the agreement, and 3) AHI knew they had purchased the centers at a discount and believed they would be profit centers.
In August 2008, the arbitration panel ruled that: 1) the failure to disclose the loss of referrals from the Houston Neurology Center was not material to the transaction, 2) the Asset Purchase Agreement was not breached, and 3) AHI had failed to prove its damages.
Arbitration from the 116th Judicial District Court
(Dallas County, TX)
The Focal Point’s Client