UMass Memorial affiliate trades lawsuits with former president

Courtesy UMass Memorial Health Care said it will fight a suit against Shields Health Solutions.

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By Laura Finaldi

Editor’s note: This story was originally posted on April 6 but was updated on April 7 with new information.

Dueling multi-million dollar lawsuits filed within the past week pit Shields Health Solutions, LLC, a co-venture with UMass Memorial Health Ventures, Inc. and its co-founder, Jack Shields, Sr. against former company president Tom Guilfoile.

A $20-million whistleblower lawsuit filed in Massachusetts federal court April 1 alleges Jack Shields, Sr. and the company breached employee agreements and retaliated against Guilfoile for reporting what he believed to be illegal business practices.

On Tuesday, Jack Shields, Sr. counter-sued Guilfoile in Plymouth Superior Court for defamation and tortious interference with business relationships. The suit says Guilfoile caused damages that could amount to over $12 million annually.

Shields Health Solutions is a joint venture of Shields Pharmacy, LLC of Quincy and UMass Memorial Health Ventures, an affiliate of Worcester's UMass Memorial Health Care. Shields provides specialty pharmacy management services to hospitals in New England and across the country.

Guilfoile's federal suit brings eight claims against the specialty pharmacy management services provider and Shields, Sr. It alleges Shields, Sr. directed illegal payments to a long-time friend and consultant to several hospitals in exchange for referrals; was involved with fraudulently diverting company assets for his own personal financial gain; and knowingly falsely represented company contracts with hospitals relating to the provision of vital medication management services to chronically ill patients with serious medical conditions, according to a release detailing the lawsuit.

UMass Memorial spokesman Anthony Berry said that the healthcare provider will fight Guilfoile's suit.

"We strongly disagree with the allegations and assertions against the pharmacy and Jack Shields, by a former employee fired for cause, and we will defend against them vigorously," Berry said.

Shields’ lawsuit against Guilfoile alleges that while an employee at Shields Health Solutions, Guilfoile lied about his qualifications, was incapable of completing his duties and targeted employees who disagreed with him for either harassment, dismissal or salary reduction. The suit alleges that Guilfoile lost the company millions of dollars in existing and potential accounts, including two major New Jersey hospital systems and a major Boston hospital.

Guilfoile was terminated on Dec. 22 and in retaliation, attempted to extort Shields by accusing him of improper conduct and making defamatory statements about him to important business partners, the suit alleges.

Ray Howell, a spokesman for Jack Shields, Sr., said Guilfoile threatened to extort Shields if he didn't get his job back, and followed through on that promise when Shields refused to re-hire him.

"Mr. Guilfoile was fired and then tried to get his job back by threatening to make accusations against the company and its founder. When they refused to give in to his extortionate demands, he carried through on his promise and filed a lawsuit that contains false accusations. Our lawsuit is intended to recover damages from the harm caused by Mr. Guilfoile's actions," Howell said.

Nicholas H. Sikon of Outten & Golden LLP, a New York law firm representing Guilfoile, said there is no merit to the allegations brought forth in the suit against Guilfoile.

"We believe the complaint is frivolous, that the allegations contained therein are false, and that the suit is yet another act of retaliation against Mr. Guilfoile for speaking out against potentially illegal activities within the company," Sikon said.

CORRECTIONS: A previous version of this story incorrectly used a photo of a Worcester facility run by Shields Health Care Group of Quincy, which is not involved in the lawsuit in any way. The previous version also incorrectly said Shields Health Solutions, LLC provided MRI services.