MOUNT LAUREL, N.J., June 11 /PRNewswire-FirstCall/ -- MedQuist Inc. (Pink Sheets: MEDQ.PK). On June 9, 2008, the U.S. District Court District for the District of New Jersey dismissed the South Broward customer class action without prejudice to the right, upon motion and good cause shown, within 60 days, to reopen the action if the settlement is not consummated. The company is in the process of informing the court that the settlement has, in fact, been consummated through payment of the settlement amount and filing of a stipulation of dismissal with prejudice. As previously announced the South Broward action was filed against the company and certain present and former officers and the complaint alleged that the company overcharged certain non-federal governmental hospitals and medical centers for transcription services. Under the terms of the settlement agreement, the company has paid $7,537,001.83 to resolve all claims by the individual named plaintiffs and certain other putative class members represented by plaintiffs' counsel but not named in the action. The settling parties have released the company and all individual defendants from any and all claims and dismissed the action in its entirety with prejudice. Neither the company, nor any of the individual defendants, has admitted or will admit to liability or any wrongdoing in connection with the settlement.
This dismissal of the South Broward lawsuit follows the other recently disclosed tentative settlement reached on or about April 21, 2008 regarding all individual and class claims related to the consolidated medical transcriptionists' putative class action lawsuit in exchange for payment by MedQuist of $1.5 million plus certain injunctive relief. The consummation of these two settlements will result in the final resolution of all class action litigation matters related to (i) the allegations raised by a company employee in November 2003 that the company had engaged in improper billing practices, (ii) the company's public disclosure of those allegations and (iii) the company's July 2004 public disclosure of certain findings from the independent review (the "Billing Review") of the allegations that was undertaken by the company's board of directors. The previously disclosed Securities and Exchange Commission ("SEC") and Department of Justice ("DOJ") investigations remain ongoing and the company continues to fully cooperate with both investigations.
The company and its interim president and chief executive officer, Howard S. Hoffmann of Nightingale Associates, LLC, announced that Mr. Hoffmann's service as the company's interim president and chief executive officer, and the related engagement of Nightingale, terminated consensually on June 10, 2008. Accordingly, the company's board of directors has appointed Mark Ivie, the company's chief technology officer, to serve as the interim chief executive officer and president, effective as of June 11, 2008. Mr. Ivie will also continue to serve as the chief technology officer.
"Howard Hoffmann was appointed as MedQuist's interim CEO, and subsequently President, with a clear mission to improve the company's business practices, including its billing practices, and to bring the company current in its SEC filings," stated Gregory M. Sebasky, chairman of the board of directors. "He has been successful on these fronts, including effectively resolving all issues related to the material customer, employee and shareholder litigation matters arising from the Billing Review, as well as leading the company through the strategic evaluation process and implementing a variety of operational turnaround initiatives that have resulted in improved margins and customer satisfaction. In addition, he has led the company in fully cooperating with the investigations by the SEC and DOJ relating to the Billing Review, and we are optimistic that both matters are nearing conclusion. We thank Howard for his contributions and achievements in all of these areas."
Regarding the appointment of Mr. Ivie as the company's interim president and chief executive officer, Mr. Sebasky further stated, "As a 25 year industry veteran with three years of accomplishments while at MedQuist, Mark has the full support of the board as well the senior management team on his expanded duties."
The company's board of directors has also confirmed that it is proceeding currently to seek to complete its listing on the NASDAQ Global Select Market.
MedQuist is the largest Medical Transcription Service Organization (MTSO) in the world, and a leader in technology-enabled clinical documentation workflow. MedQuist's enterprise solutions - including mobile voice capture devices, speech recognition, Web-based workflow platforms, and global network of medical editors - help healthcare facilities improve patient care, increase physician satisfaction, and lower operational costs. For more information, please visit http://www.medquist.com.
Disclosure Regarding Forward-Looking Statements:
Some of the statements in this press release constitute "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are not historical facts but rather are based on the company's current expectations, estimates and projections regarding the company's business, operations and other factors relating thereto. Words such as "may," "will," "could," "would," "should," "anticipate," "predict," "potential," "continue," "expects," "intends," "plans," "projects," "believes," "estimates" and similar expressions are used to identify these forward-looking statements. The forward-looking statements contained in this press release include, without limitation, statements about the expected timing of the conclusion of the SEC and DOJ investigations, as well as the company proceeding towards a listing on NASDAQ. These statements are only predictions and as such are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict, including, without limitation, the risk that SEC and DOJ investigations will not be resolved in a timely manner and that the company will not timely, if at all, list on NASDAQ. For a discussion of these risks, uncertainties and assumptions, any of which could cause our actual results to differ from those contained in the forward-looking statement, see the section of the company's Annual Report on Form 10-K for the year ended December 31, 2007, entitled "Risk Factors" and discussions of potential risks and uncertainties in the MedQuist's subsequent filings with the Securities and Exchange Commission.
|SOURCE MedQuist Inc.|
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