Laser Spine Institute closed its doors in March, claiming it was unable to attract financing to undergo Chapter 11 bankruptcy and continue operations. A new article in the Tampa Bay Times outlines some of the business decisions that led to the shut-down.
Four things to know:
1. Since 2010, Laser Spine Institute has been involved in a lawsuit with a former partner Joe Samuel Bailey, who claimed "breach of fiduciary duty, defamation, slander and violation of the Florida Deceptive and Unfair Trade Practices Act, conspiracy and tortious interference" against Laser Spine's founders. In 2017, a judge awarded Mr. Bailey $6.85 million and Laser Spine appealed; in June, the judge awarded Mr. Bailey $260 million.
2. Laser Spine Institute also continued to provide large salaries and bonuses for executives as the company built up debt, according to the report.
3. A lawsuit filed by managing partner of KapilaMukamal, the firm collecting and distributing Laser Spine Institute's assets, reports that in 2015 the company incurred $150 million in debt and company executives took $110 million from a loan and illegally distributed it. The complaint also alleges Laser Spine knew it needed immediate liquidity in 2015.
4. Despite its debt, company decided to construct a $56 million corporate headquarters and surgical facility in 2016. That same year, it laid off 6 percent of its workforce.