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Pitt Development Group sues Mercy

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Pitt Development Group LLC has filed suit against Mercy after previously building clinics for the health system.

The suit alleges Mercy retaliated against Pitt Development Group for blowing the whistle on a health care executive, resulting in the company losing profits for agreed-upon clinics. The suit filed by Pitt Development Group on Jan. 25 in Greene County Circuit Court asks for a jury trial and seeks "fair and reasonable" damages.

Mercy spokesperson Ettie Berneking provided a statement to Springfield Business Journal yesterday.

"While Mercy does not comment on pending litigation, we will always vigorously defend and safeguard Mercy’s excellent reputation and uphold our long-standing commitment to sound business practices," the statement reads. "We will rely on the court system to resolve this litigation and reach an outcome that is just."

Pitt Development Group alleges in the suit that it lost out on business after Mercy retaliated against the company for blowing the whistle on Donn Sorensen, a former Mercy executive. The suit alleges Sorenson, former regional president of Mercy, and John Farnen, former Mercy vice president of planning, design and construction, told Pitt Development Group to pay Springfield architect Steve Warlick $65,000 as "social capital" despite not needing his services.

"PDG became concerned about Sorensen and Farnen's reasons for wanting Warlick paid despite him doing no work," the lawsuit reads. "PDG then discovered a disturbing connection between Sorensen and Warlick that related to business dealings, personal dealings and the sexual exploitation of women."

According to the lawsuit, Pitt Development Group reported the alleged conduct to Mercy Chief Financial Officer Cheryl Matejka and former Vice President of Financial Planning Brian Day. After an internal investigation, both Sorensen and Farnen exited the health system, according to the suit. Sorensen, who had worked for Mercy in Springfield and St. Louis, ended a 22-year career with the health system in December 2021, according to his LinkedIn profile. Farnen ended a 24-year career with Mercy in March 2022, according to his LinkedIn profile.

"After PDG reported the attempted extortion and sexual exploitation of women in return for Mercy business, Mercy then turned against PDG who it perceived to be the 'whistleblower,' and initiated a systematic campaign to harm PDG," the suit reads. "After PDG became a whistleblower and informed Mercy about Mercy employee(s) potential bribery, extortion, and sexual assault of women, including those below the age of 18, involving Mercy employee(s), Mercy retaliated against PDG."

After Pitt Development Group built three clinics for Mercy in Ozark, Joplin and St. Louis, Sorensen approached the company to build and develop another 10 in St. Louis County, according to the lawsuit. Pitt Development Group completed four of the 10 agreed-upon clinics before Mercy initiated a freeze on developer-financed clinics in mid-2018, and in 2021, Mercy approached Pitt Development Group to build three clinics in Springfield and another location in Poteau, Oklahoma, the suit claims. Pitt Development Group continued to work on the clinics and alleges in the suit that Mercy hindered progress on the clinics until halting the projects in April 2022.

"As a result of Mercy's conduct, PDG has suffered a substantial pecuniary loss," the suit reads.

In two breach-of-contract allegations contained in the suit, Pitt Development Group alleges combined pecuniary losses of more than $9 million.

Pitt Development Group, led by Springfield businessperson Doug Pitt, is represented in the lawsuit by Strong Law PC.

Pitt Development Group began building clinics for the health system in 2014, according to past Springfield Business Journal reporting. The company’s first job for Mercy was the $6 million Mercy clinic in Ozark.

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