Steward Health Care’s CEO won’t be at a congressional hearing next week despite being subpoenaed, as his attorney says his testimony would be “wholly inappropriate” amid bankruptcy proceedings.
Alexander J. Merton, an attorney representing Dr. Ralph de la Torre, has requested the U.S. Senate Committee on Health, Education, Labor and Pensions to postpone his client’s testimony and to reschedule the Sept. 12 hearing until after the proceedings.
Merton’s calls came in a letter to Sen. Bernie Sanders, D-VT, the chairman of the HELP Committee, on Wednesday, hours before a federal bankruptcy court judge approved Steward’s plan to sell its six Massachusetts hospitals.
Despite the plan receiving the green light, Judge Christopher Lopez decided to keep the conditions of the closings in the works. The targeted closing date is Sept. 30.
In his letter, Merton highlighted how Steward decided last week to prohibit de la Torre from speaking on the company’s behalf regarding any “bankruptcy-related issues.”
That’s because “those matters had already been delegated exclusively to an independent sub-committee of Steward’s board of managers established” last December, Merton wrote.
“As Steward’s missive explains,” he wrote, “Dr. de la Torre is prohibited from testifying about anything within the (committee’s) purview, including ‘topics related to the Company’s debt obligations, potential claims or causes of action, chapter 11 sale transactions, chapter 11 financing transactions, and/or similar transactions and related matters.’ ”
The HELP Committee voted in July to launch a Congressional investigation into what led Steward to file for bankruptcy protections this past May and to subpoena on-the-record testimony from de la Torre, who they say is ultimately responsible for the company’s failure and answerable to its patients.
The committee planned to ask de la Torre to explain how he and his fellow executives were able to walk about with hundreds of millions of dollars — which lawmakers have argued was used to buy luxury boats, private jets, and posh Texas mansions — only to have their attorneys seek bankruptcy protection from over $9 billion in debts.
Massachusetts’ U.S. Sens. Ed Markey, the chairman of the subcommittee holding the hearing, and Elizabeth Warren, blasted de la Torre’s “defiance of a subpoena to appear before the Senate,” which they called “outrageous.”
“He got rich as private equity and real estate vultures picked apart, and drove into bankruptcy, hospitals that employed thousands of health care workers who served communities in Massachusetts and across the country,” Markey and Warren wrote in a joint statement. “De la Torre used hospitals as his personal piggy bank and lived in luxury while gutting Steward hospitals.”
Markey and Warren previously invited de la Torre to offer voluntary testimony at a senate committee field hearing held in Boston on April 3, more than a month before the company told a Texas bankruptcy judge they would need to sell their hospital systems at auction as part of Chapter 11 proceedings.
De la Torre did not appear for the hearing.
“Unfortunately, while Dr. de la Torre has continued to fight for Steward hospitals and the patients and communities they serve,” Merton wrote in his letter to Sanders, “members of this Committee continue to cast aspersions on Dr. de la Torre and appear determined to turn the hearing into a pseudo-criminal proceeding in which they use the time, not to gather facts, but to convict Dr. de la Torre in the eyes of public opinion.”
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