HealthSouth Fires Back with $76M Scrushy Lawsuit

December 29, 2005 (PLANSPONSOR.com) - The bitter war of words between HealthSouth Corp. founder Richard Scrushy and his old firm over Scrushy's alleged wrongdoing has been ratcheted up a notch with a $76+-million HealthSouth lawsuit filed against the executive.

HealthSouth said its lawsuit was to recoup back salary, bonuses and stock awards paid to Scrushy, Reuters reported. It said Scrushy’s attempt in his recent suit against HealthSouth to recover more than $100 million for compensation, severance, other benefits and legal fees (SeeĀ  Scrushy Hits Back with Wrongful Firing Suit ) marks “the latest in his ongoing efforts to pillage HealthSouth.”

The firm charged in the court documents that Scrushy “systematically plundered” it by directing a multibillion dollar accounting fraud to inflate the company’s financial health and enrich himself.

Scrushy, who founded the Birmingham, Alabama-based operator of rehabilitation hospitals and surgical centers, was ousted as HealthSouth’s chairman and chief executive in 2003.

The government accused him of directing a $2.7 billion accounting fraud at HealthSouth between 1996 and 2002, but a federal jury in June found him not guilty of criminal charges. However, Scrushy still faces US Securities and Exchange Commission civil charges in 2007.

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