Valley Medical sues UW Medicine to reverse merger

SEATTLE -- The public hospital district connected with Valley Medical Center is suing University of Washington Medicine over a merger that has already taken effect, and no one can guess the taxpayer tab.

UW Medicine and Valley Medical formed an alliance -- a merger of sorts to create better health care last year. Phil Talmadge, who represents members of the Valley Medical Center's board, says changing the composition of the board hurts taxpayers and patients.

"You don't want some faceless bureaucrats appointed by somebody else running your hospital," Talmadge said.

Last year, Valley Medical's former five-member board voted to enter into that agreement with UW Medicine to streamline health care and increase options for patients. The board went from five elected members to a total of 13, with eight new members appointed by UW Medicine.

"There's a group of un-elected people of trustees who basically run the district, and they're immune from any kind of accountability to the voters," Talmadge said.

With new elections and appointments, make-up of the board changed and Talmadge's clients on the board are suing to stop the alliance. He's afraid unappointed people can run roughshod over elected board members on things like staffing, quality of care and salaries.

In the past, Valley Medical came under fire for a controversial $1 million payment to CEO Rich Roodman for early retirement and for other high salaries. New records obtained by KOMO 4 show that hefty six figure salaries haven't changed.

"Here we have people that are getting paid magnificent, opulent salaries in trouble economic times," Talmadge said.

So now, in a way, the board is suing itself.

"It comes as quite a surprise and more than a little disappointing," said Lou Peterson, an attorney representing UW Medicine in the lawsuit.

Peterson says at the time, in-house counsel and outside attorneys found no legal problems with the agreement.

"This was a carefully thought-out, finely-tuned alliance," Peterson said.

Peterson says it is unprecedented to sue just because political winds have shifted.

"That's another reason why we're surprised when this was so carefully thought-out and sanctioned, and approved by the legal framework, and now well under way in terms of implementation," he said.

Now a judge will have to get involved in a case for health care.

The price tag is unknown. UW and Valley Medical are both taxpayer-supported, meaning the voters are paying the salaries for those two lawyers. Because of the complicated nature of the case, Peterson was contracted as outside counsel; UW's staff lawyers are not handling the lawsuit.

No court date has been set.