Lisa and Kathleen were M.D.s who joined Crest Medical Group, Inc., an established OB/GYN practice in Riverside, as employees. After several years of practicing as employees on a salary, the founder of the practice told them they would then be paid on a revenue less expenses formula. This evolved into being paid a percentage of the gross revenue attributable to each doctor, which was 48%.
Although the three doctors had many discussions and exchanged various drafts of written agreements, there was no final agreement that they all signed. Drs. Lisa and Kathleen had worked through their newly formed PCs for months without a written agreement. After working together for several years and being paid under the 48% formula, Drs. Lisa and Kathleen decided independently to move on. A dispute arose over the 48% of payments received after the end of the relationship – but for services rendered during the relationship.
Physician groups get paid by insurance companies and Medi-Cal or Medi-Care weeks or months, and sometimes many months, after the services are rendered. In this case, Crest Medical Group thought it could continue to collect 100% of the revenue generated by the services of Drs. Lisa and Kathleen as those monies trickled in over the next year. A Riverside County jury disagreed. Drs. Lisa and Kathleen proved Crest received $218,632 for services they rendered. They asked only to be paid their 48%, no more and no less, and the jury agreed with them to the penny.
Trial Lawyer for the two Physicians: Robby Robinson of Quest Law Firm
(Reported in the Verdicts and Settlements section of The Los Angeles Daily Journal in October 2006)