Touro sues third-party over incomplete employee background checks

By Eliza Walker | Dec 2, 2013

NEW ORLEANS – Touro Infirmary has filed suit against a third-party company it contracted with to complete employee background checks after learning that one of its nurses had in fact had her license revoked six years prior.

The suit was filed against Employment Research Services LLC, Employment Research Services of Layfayette LLC, Tech Cheque LLC, American Research Clearing Corp, Employment Research Services, James A. Bealer, Donald R. Bealer, Cynthia Bealer, Heidi H. Bealer, Harold Herbert, Paul Scallan Jr. and their insurance company.

The suit states that Touro contracted with ERS to perform background checks for the nurses at its main hospital on Foucher Street in New Orleans. ERS allegedly conducted at least four background checks for Touro from 2007 through 2010 related to a specific nurse.  In a check of the same nurse in 2011 it was discovered that her license was revoked or suspended.

Upon receipt of this new information, Touro terminated the nurse without pay, and disclosed the issue to the Office Inspector General of the Center for Medicare and Medicaid Services.

In a subsequent communication between ERS and the OIG, ERS confirmed this story, and admits that it “made a huge mistake” in its prior background checks. ERS informed the OIG that it “know[s] that Touro is facing suffrage for our acts and/or omissions…[and ERS is] going to do the right thing and do our best to make Touro whole financially.”

Touro ultimately reached a settlement agreement with OIG, agreeing to pay OIG the wages and benefits Touro paid to Dyess for the six years prior to the discovery, totaling $427,561.59.

Despite ERS’s prior admissions of its liability and promise to “make Touro whole financially” ERS has allegedly failed to reimburse Touro for the amounts Touro paid to resolve the matter.

ERS is accused of breach of contract, enrichment without cause and vicarious/alter ego/single business enterprise liability.

Touro is represented by Martha Y. Curtis of Sher Garner Cahill Richter Klein & Hilbert LLC of New Orleans.

The case has been assigned to Division G Judge Robin M. Giarrusso.

Case no. 13-9089.

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