Originally created 12/18/99

Whistle-blower wins case



A U.S. District Court jury sided with Michael Haddle on Friday afternoon, finding his former bosses fired him for helping uncover corporate crimes that cost taxpayers more than $10 million.

But in the same verdict, the jury awarded Mr. Haddle just $65,000 in compensatory damages against Jeannette Garrison, founder and owner of the now-defunct Healthmaster Inc., the company, and her corporate legal counsel and top executive, G. Peter Molloy.

"You won again," defense attorney David Hudson told Mrs. Garrison after the jury verdict was announced at the conclusion of a five-day federal court trial. The low amount of damages left the defense team in smiles, extremely pleased with the jury's decision about damages. But they still intend to challenge the verdict, Mr. Hudson said.

Afterward, Mr. Haddle smiled, too. "I'm pleased with the verdict. It vindicated me.

"Sometimes those things are more important than money."

Mr. Haddle's legal battle to clear his reputation began nearly five years ago when Mr. Molloy fired him from his job -- three months after a federal grand jury issued a 133-count criminal indictment against Mrs. Garrison, Healthmaster, and top corporate executives Dennis Kelly and David Suba.

The government would prove in subsequent court action that Medicare had been defrauded out of millions of dollars and require Mrs. Garrison to repay a total of $16.5 million. She, Mr. Kelly and Mr. Suba were convicted and sent to prison.

Mr. Molloy, selected by Mrs. Garrison to lead her home health care corporation after it was placed in bankruptcy, testified as the last witness Friday. He insisted he had valid reasons to fire Mr. Haddle and Mrs. Garrison had nothing to do with the decision.

"I feel like I've done nothing wrong, and I'm a little disappointed," Mr. Molloy said after the trial. But his attorney, Patrick Claiborne, said they were certainly pleased with the low amount of damages the jury awarded.

Mr. Haddle gave jurors two estimations of his damages -- $466,278 or $183,827. He based those figures on the full salary and benefits he received at Healthmaster in 1994 before and after his salary was cut by nearly half.

The damages, however, were based on the theory that the company that purchased Healthmaster Home Health Care in 1995 would have taken Mr. Haddle as an employee and kept him until most employees were laid off in November 1998. By deposition, the chief executive officer testified that he did not hire those few people who were responsible for finances at Healthmaster.

Mrs. Garrison's attorneys said if the jury believed Mr. Haddle's claims, his damages amounted to less than $5,000.

Mr. Haddle's job at Healthmaster was vice president of Medicare reimbursement, preparing the reports submitted to the government health-care program, which accounted for about 90 percent of the $50 million in business Healthmaster did each year.

Although Mr. Kelly, the chief financial officer, kept a grip on financial information and only gave Mr. Haddle edited information to use for the Medicare cost reports, Mr. Haddle realized the government was being cheated: Mrs. Garrison had employees make political campaign contributions and then used Medicare funds to pay them back double; and money was being embezzled from Medicare and from employee pension plans.

Mr. Haddle was essential to the successful prosecution, the lead prosecutor and investigators testified this week. He made their case for them, they testified.

The defense slammed Mr. Haddle for giving someone outside the company information about the crimes, and knocked him for not going to authorities sooner.

Mr. Hudson, Mr. Claiborne and Phillip Bradley all argued in closing Friday that Mr. Haddle's case was just so much smoke and an attempt to mislead the jury into thinking that just because bad acts had been committed at Healthmaster, that entitled Mr. Haddle to a judgment.

"It's just trash," Mr. Hudson described Mr. Haddle's case to the jury.

"The trash that has gone on here is the trashing of Michael Haddle," Charles C. Stebbins III countered in his closing arguments.

"A man's reputation is in your hands. Who is the innocent party here and who is the guilty party -- Michael Haddle or Jeannette Garrison?" Mr. Stebbins asked the jury.

Occasional references popped up during the weeklong trial about the hard-fought and lengthy legal clashes that took place before the trial began.

After Mr. Haddle filed suit in July 1996, first a federal judge and then a state court judge ruled Mr. Haddle had no right to sue because he was an "employee at will." In Georgia, employers can fire non-contract employees for nearly any reason or for no reason at all. Even the 11th U.S. Circuit Court of Appeals agreed.

But in a rare move, the U.S. Supreme Court granted Mr. Haddle's petition for an appeal.

The U.S. Justice Department threw its support to Mr. Haddle, arguing in unison with Mr. Haddle's attorneys that employees who cooperate with federal investigations must be protected from retaliation and punishment.

On Dec. 14, 1998, the U.S. Supreme Court ruled Mr. Haddle was entitled to his day in court.

"We've accomplished a lot. We won a (U.S.) Supreme Court decision," Mr. Haddle said Friday evening.

ReachSandy Hodson at (706) 823-3226 or shodson@augustachronicle.com.