To settle charges that it misused state money, Spectrum Health Systems, Inc. has agreed to pay the State of Massachusetts $7.5 million. Spectrum is a nonprofit organization that provides treatment for substance abusers; the settlement was announced in January 2007.

Spectrum came under attack in 2004 after Massachusetts Auditor A. Joseph DeNucci released a report that found the organization had misused $13.4 million in state funds over a 10-year period. The majority of that money, $10.2 million, was funneled through a no-bid contract to CiviGenics, which held a management contract with Spectrum from 1996 to 2002.
CiviGenics operates prisons and substance abuse programs in secure facilities.
DeNucci also questioned a $3.3 million purchase of CiviGenics? Barton Road Clinic by Spectrum, as the clinic was failing financially. Another bone of contention was almost $1 million in compensation paid by Spectrum to a former chairman for undocumented consultation services while he was living in Alaska and Florida.

Under the settlement agreement, Spectrum will pay Massachusetts $3.5 million, CiviGenics will reimburse $3.4 million, and CiviGenics President Roy Ross will pay $650,000. In total the state will receive $7.5 million of the nearly $17.5 million in misappropriated payments. Which isn?t a very good return ...

In July 2007, Alabama Governor Bob Riley announced a plan to sell approximately 6,000 acres of state prison land to finance the construction of new prison beds and make needed repairs to existing facilities. The extra bed space would enable the state to return Alabama prisoners who are housed out of state.

The land sale is expected to generate between $16.3 million to $23.9 million. Up for sale are the 3,869 acres of the Farquhar State Cattle Ranch in Hale County; 2,045 acres of the 2,409-acre Red Eagle Honor Farm in Montgomery County; the former Department of Corrections 1-acre office site adjacent to the Capitol; 32 acres in Wetumpka; and 10 acres of the old Kilby Prison site in Montgomery.

?These properties are a financial drain on the taxpayers and aren?t needed,? said Gov. Riley. The state previously sold 540 acres of swampland from the Farquhar Cattle Ranch to private landowners for $1.6 million.

The state currently spends $12.4 million a year to keep Alabama prisoners in Louisiana jails. The money from the land sale will be spent exclusively to expand the prison system and renovate or repair buildings to bring those prisoners back to Alabama.

To create further bed ...

On August 9, 2006, Taser International, Inc. (Taser) proposed $20 million in company stock, cash and insurance proceeds to settle shareholder class action and derivative suits pending in the U.S. District Court for Arizona and derivative suits pending in the Arizona Superior and Delaware Chancery Courts. In return, all claims ...

On January 10, 2005, the U.S. District Court for the District of New Jersey agreed with a state prisoner?s contention that the failure of Prison Health Services (PHS) to monitor her lithium levels fell under the common knowledge exception of N.J.Stat.Ann. § 2A:53A-27, and granted her motion for reargument.

Upon admission to New Jersey?s Camden County Jail on August 13, 2002, plaintiff Debra Bryan informed intake personnel that she was taking lithium as part of her treatment regimen for bipolar disorder. While at the jail Bryan began experiencing various medical problems, including ?nausea, vomiting, swollen ankles, aches and pains, confusion, pressure behind her eyes and ears, rapid and unexplained weight gain, and acute abdominal pain.? On September 28, 2002, Bryan was transferred to a hospital where ?blood and laboratory tests determined that her lithium level was three times the accepted maximum safe level and that she was suffering from lithium toxicity.?

Bryan sued PHS (the jail?s medical provider), Dr. Amira Shah and multiple other defendants, claiming they twice failed to perform blood tests that had been ordered by a doctor, and that such negligence resulted in heart failure, renal complications and mental anguish. She made claims under both state and ...

The Missouri Court of Appeals held that a state circuit court lacked jurisdiction to rule on a summary judgment motion in a case that had been removed to federal court.

Missouri prisoner Edward Moore successfully sued Correctional Medical Services (CMS) for deliberate indifference to his serious dental needs. A jury ...

A federal judge in Illinois has granted class action status to a group of Cook County prisoners who were subjected to painful medical tests without their explicit consent.

Plaintiffs Robert Jackson, Joseph McGrath and Derrell Smith claimed that during the intake process at the Cook County Jail they were forced to undergo screening for sexually transmitted diseases (STDs). As part of the screening process, a medical technician with Cermak Health Services shoved a cotton swab into the prisoners' penises to collect a sample.

The prisoners acknowledge they signed a consent form during the hectic intake process. But they contended that "the totality of circumstances at the receiving unit makes it impossible for anyone to give valid consent to the insertion of the urethral swab."

The plaintiffs moved for class action certification in the U.S. District for the Northern District of Illinois, Eastern Division. In support of their motion the plaintiffs submitted affidavits from 14 other prisoners who swore they were subjected to similar procedures at the jail. The plaintiffs further alleged that the "invasive procedure has been applied to more than one thousand persons from January 27, 2004 to the present."

On December 14, 2006, Judge David H. Coar granted ...

In partially reversing a Nebraska federal district court's grant of summary judgment, the Eighth Circuit Court of Appeals has held the Nebraska State Tort Claims Act (NSTCA) does not apply to contracted medical service providers.

That ruling came in the appeal of Nebraska prisoner Otha Smith, who filed an action alleging violation of his constitutional rights and negligence. Smith named as defendants Harold Clarke, then-director of the Nebraska Department of Correctional Services, and Dr. Patrick Colerick. The district court granted the defendants' motion for summary judgment.

Smith's claims arose due to a tumor that was removed surgically from his left eye. While working in the prison kitchen in March 1999, Smith accidentally splashed clear fluid in his left eye. He requested to see a doctor but was not examined until November, despite an appointment being scheduled for June.

At the November examination, Dr. Colerick found Smith's pupil response was normal. Six months later Smith complained of redness in the eye. Dr. Colerick attributed it to Smith's age and sun exposure. In May 2001, Dr. Colerick observed Smith's pupils were not reacting normally. An ophthalmologist determined Smith had a tumor on his pituitary gland that was pinching an optical nerve. Removal ...

by Matt Clarke

On April 9, 2007, a federal district court in Texas held that the conditions of confinement at a privately-run facility used by Immigration and Customs Enforcement (ICE) to hold families detained due to immigration issues violated the terms of a class-action settlement related to the detention of children.

Challenges to conditions at the T. Don Hutto Family Residential Center were raised in sixteen civil rights suits filed under 42 U.S.C. § 1983.
The plaintiffs were minor children who entered the United States illegally with their parents. Prior to 9-11, immigration detainees with families were released on bond and given a date to appear in court, which was referred to as the ?catch and release? policy.

After 9-11 and the creation of ICE under the Department of Homeland Security (DHS), immigration policies were tightened and immigration detainee families were incarcerated using separate facilities for men, women and children. In response to concerns about removing children from their parents, ICE developed the concept of family detention centers (FDCs). There are two FDCs; one in Berks County, Pennsylvania is a converted nursing home, while the other, the Hutto facility, located in Taylor, Texas, is a converted medium-security prison that has ...

by John E. Dannenberg

Compass Group USA, Inc. doing business at the Los Angeles County Jail as Canteen Services (Canteen), was booked by the county auditor for extracting $640,213 in excess profits from its gross prisoner canteen revenues of $78 million between 2000 and 2005 and spending this sum on expenses not related to the county contract. This included wining and dining unidentified Sheriff?s department officials to the tune of $169,465. The $640,213 in disallowed deductions should have instead been booked as ?profit sharing? paid to the county for prisoner-benefit programs. Compass Group responded to the audit by claiming that it, an $8.4 billion corporation, actually underbilled the county for its corporate overhead, and was thus owed money.

Canteen?s five-year contract with the county jail provides that it shall return 31%; of net commissary sales to the county, as well as 50% of any profits in excess of a 6% target. Thus, the county exacts a 31% ?commission? for the privilege of doing business with them, plus incentifies the vendor to make excess profits. All of this cost basis, of course, simply goes to artificially jacking up the cost of canteen purchases to the prisoners and the low-income families who ...

by David M. Reutter

In May 2007 the Florida Department of Law Enforcement (FDLE) issued a 22-page report which found that $12.7 million in overpayments to the state's private prison contractors did not result from an intent "to steal or defraud." PLN previously reported on this investigation, which was ordered by Gov. Charlie Crist after the overpayments were discovered by state auditors. [See: PLN, June 2007, p.32; Nov. 2007, p.38].

The private prison contractors involved, GEO Group (formerly Wackenhut Corrections) and Corrections Corporation of America (CCA), were under contracts supervised by the state's Correctional Privatization Commission (CPC). The Florida legislature created the CPC in 1993 to oversee limited privatization of the state's prisons. The commission was abolished in 2004 after numerous scandals; one of its executive directors was fined by the state Ethics Commission, while another is serving time in federal prison for embezzlement of CPC funds.

The FDLE report found that the legislature had reviewed the contracts and annual budgets, so nothing had been hidden. "There was no evidence that the budget requests were fraudulent or incomplete," the report stated. Nor was there any evidence "that any group or individual ever solicited or accepted any compensation in return for ...