Hutcheson Medical Center in Fort Oglethorpe, Ga.Please read the following messages:From Jim Bob and Michelle: Back 12 years ago our family went through one of the...
Posted by Duggar Family Official on Thursday, May 21, 2015
A federal judge has halted Erlanger Health System's attempts to foreclose on Hutcheson Medical Center, saying the dueling hospitals first must have their day in court.
"We are ecstatic," said Hutcheson CEO Farrell Hayes. "This is a big relief, and it definitely buys us time."
The judge's decision comes days after the North Georgia hospital filed for Chapter 11 bankruptcy as it faces $60 million in debts, a move Hayes said was necessary to protect the hospital as Erlanger presses to recoup more than $20 million it loaned Hutcheson during a now-defunct management agreement.
But the move was not a guarantee that Erlanger could not still move forward with foreclosure on Jan. 6, the date originally allowed by U.S. District Court Judge Harold Murphy
Hutcheson has appealed an earlier ruling about the legality of the foreclosure process, and while that appeal is pending before the 11th U.S. Circuit Court of Appeals, Murphy said the foreclosure needs to be delayed.
Murphy also wrote that Hutcheson would suffer "significant harm" if foreclosed upon, and added that staying the foreclosure would do no harm to Erlanger.
"The public has an interest in the property continuing to operate as a hospital," Murphy wrote.
Erlanger has argued the attempt to foreclose on Hutcheson is a legal step in the process to hold the Fort Oglethorpe hospital accountable to the agreement, since the hospital's property was put up for collateral during the original agreement.
"This latest order comes as no surprise," said Chief Administrative Officer Gregg Gentry. "We fully expected the court to stay the proceedings. Hutcheson's request for the stay is within their rights, and we are respectful of the court's ruling."
But Hutcheson has argued they owe Erlanger nothing, saying Erlanger did not hold up its end of the management agreement, and officials has filed their own counter-suit. Meanwhile, Hutcheson has held community meetings to drum up support for keeping the North Georgia hospital open.
Contact staff writer Kate Harrison Belz at 423-757-6673 or kbelz@timesfreepress.com.