Hunter
09/11/23
A US bankruptcy trustee overseeing the case of Mercy Iowa City’s sale to the University of Iowa is objecting to who the hospital plans on paying with the proceeds.
The Gazette reports acting U.S. Trustee Mary R. Jensen has concerns about Mercy’s request to keep Toney Korf Partners of New York City as their interim managers. Jensen also objected to Mercy’s use of the McDermott Will & Emery law firm, the Nyemaster Goode firm, and H2C Securities — due to, among many reasons, conflicts of interest, objectionable payment proposals, lack of transparency and offensive protections. Mercy has paid those entities over $7 million in the last year, and have asked the court to allow them to continue to use those firms and pay them accordingly.
Jensen also called a proposed “success fee” of $250,000 to Toney Korf “inappropriate.”
The trustee also objected to Mercy’s use of the McDermitt Will and Emery law firm, as they also represent the University of Iowa. The firm claims their representation for the UI is on “unrelated matters.”
Mercy Iowa City has agreed in principle to sell its assets to the University of Iowa for approximately $20 million.
A hearing in bankruptcy court is set for Wednesday in Cedar Rapids.