Compass Medical closure surprises attorney who won $16M judgement against Quincy-based company

Compass Medical’s decision to shutter all of its facilities in Massachusetts came as a surprise to the attorney who helped secure a $16 million-plus payment from the Quincy-based company, which was convicted on 10 counts of fraud last year.

A Boston jury ordered Compass Medical to pay millions to Steward Medical Group following a 15-day trial inside Suffolk County Superior Court. Compass had originally sued Steward in 2017 over failure to pay bonuses to doctors and make rental payments, but jurors sided with Steward, instead finding Compass liable for fraud.

Attorney Howard Cooper, a partner at Todd & Weld who was the lead lawyer for Steward during the fall 2022 trial, said attorneys on both sides were in the process of having settlement discussions to avoid a Compass Medical bankruptcy.

“What had been happening over the last few months since the jury came back is the parties, I should say at least Steward, was attempting to engage in settlement discussion,” Cooper told the Herald. “And we were as surprised as everybody else [on Wednesday] to hear that Compass was shutting its doors.”

Cooper said it is unclear who will pay the $16.4 million owed to Steward Medical Group, though there will be future arguments about who is responsible.

If Compass files for bankruptcy, payment obligations will have to play out in bankruptcy court. If they do not file for bankruptcy, those questions could be answered in post-trial hearings for the Suffolk County Superior Court lawsuit.

A spokesperson for Compass Medical declined to comment on the lawsuit and settlement.

Compass Medical announced its “imminent plan” to close all of its facilities Wednesday, a decision that has prompted top state leaders to express concern and a willingness to look into the situation.

In a statement Thursday, Compass Board President Bruce Weinstein said officials “deeply regret the impact that Compass Medical P.C.’s closure will have on our patients and would like them to know that we are implementing a plan to ensure the continuity of their care.”

“Most Compass physicians will continue to provide medical care in their local communities as part of other practices,” the statement said. “Compass will be updating the website regularly with information on how patients can contact their physician in their new practice setting and how they can obtain access to their medical records.

The Massachusetts Health and Hospital Association said Compass Medical’s closure is of “significant concern” to its members, especially as hospitals continue to experience capacity constraints and as facilities in the southeast support additional patients during the Brockton Hospital recovery.

“In these early stages, we hope that Compass staff can be quickly re-deployed to other local facilities and that health plans will consider easing burdensome authorization requirements for patients in need of timely care,” said Patricia Noga, vice president of clinical affairs for the association.

Katie Murphy, president of the Massachusetts Nurses Association, said she is concerned about patients now “scrambling” for a primary care provider.

“I feel a lot of concern about this, we really do,” Murphy said.