‘I still haven’t seen a dime’: Here are the Utah businesses suing Steward Health Care for unpaid debts

It’s a question Tim Hunt says he anticipates: Why would he spend nearly three years working for a client that never paid him?

Hunt has several answers. The work, he said, was necessary — hospitals need pest control to eliminate lice or bedbugs that might sneak in with patients. And his company, Hunt’s Pest Control, is good at it.

Hunt said he also believed his client, Steward Health Care, when they said the money was coming.

“There were a lot of promises along the way,” Hunt said.

Hunt is one of a dozen vendors, mostly in Utah, who in the last year have sued Steward Health Care — which left Utah last year and sold its five hospitals here — for unsettled debts.

The most recent claim comes from the Utah Attorney General’s office on behalf of the state’s Department of Health and Human Services — and Utah taxpayers — the complaint says.

Each vendor claims they provided labor, equipment or other services to some or all of the five Utah hospitals Steward owned from 2017 to 2023, and still have not been paid for it.

“I still haven’t seen a dime out of Steward,” Hunt said.

The 11 lawsuits filed in 2023 seek a combined $3.4 million in damages. Three have been dismissed — one ended in a default judgement after defendants failed to respond, according to court documents — bringing Steward’s alleged unpaid vendor debts to $2.8 million.

Those damages do not include three other lawsuits brought by former investors in Steward hospitals, who claim the company shortchanged them before it sold its Utah hospitals and left the state.

Steward Health Care has dominated the news cycle in Massachusetts recently, where state officials and company executives are working to keep nine hospitals open despite financial troubles. Massachusetts leaders have accused Steward of putting profits over patient care; a Public Health Council called Steward’s practices “irresponsible,” according to reporting from WBUR.

These lawsuits claim Steward left a mess in Utah, too. And its victims are small businesses like Hunt’s, for whom $25,000 — more than two years’ worth of labor — is “a lot of money.”

These are the businesses trying to recoup what they claim Steward Health Care still owes them.

Hunt’s Pest Control

Hunt is the second of three generations to own Hunt’s Pest Control in Sandy. His father started the business in 1973, he said, and his son took it over within the last year. His brother runs the residential side of the business in Lehi.

Hunt’s Pest Control had worked with Salt Lake Regional Medical Center (now named Holy Cross Hospital - Salt Lake and owned by Centura Health) for years before Steward bought the hospital in 2017, he said.

They were always paid on time, Hunt said. For a while after Steward took over, that remained true.

According to court documents, Steward stopped paying its invoices in 2019.

Hunt’s kept doing the work, because Steward kept promising the money was forthcoming, Hunt said. Work included regularly scheduled maintenance, but also emergency calls, sometimes in the middle of the night, to eliminate bedbugs or lice. When those calls came in, Hunt said, his team always responded “within like, two hours.”

“It’s just a thankless deal,” Hunt said. “Maybe the bigwigs that write the checks didn’t know what we were doing, but they kept making promises, and nothing ever came. It’s extremely frustrating.”

Hunt said the hospital is still a client, now under new owners and management. Payment has not been a problem since Steward left.

Steward did not respond to Hunt’s legal claims. A judge issued a default judgment last week against Steward for $24,610, which accounts for unpaid invoices and late fees, according to court documents.

At least one other case has ended in a default judgment, and attorneys are now seeking to recoup the funds by going directly to the bank where they believe Steward has its account.

“I’ll feel better when I actually get the money,” Hunt said.

Utah Public Health Lab

The Utah Public Health Laboratory, a state agency under the Department of Health and Human Services, claims taxpayers have been forced to bear the costs of newborn test kids for which Steward never paid.

Assistant Attorney General Amy Jackson Leach filed a lawsuit in early February on behalf of the state’s lab. According to the complaint, Steward “owes the taxpayers of Utah” roughly $316,000.

Utah state law requires all newborn babies to be tested for certain health conditions. Hospitals administer the tests; the state lab provides the test kits and charges a fee for each one.

Steward paid for its tests regularly until 2020, the complaint alleges, and after that only paid its bills after “repeated requests” from the lab. In 2023, the lawsuit says, Steward stopped paying altogether. The lab was still legally obligated to provide the test kits, the complaint said, because newborn babies were required to take the test — and that cost has fallen on taxpayers.

A spokesperson for the Attorney General’s office did not respond to a request for comment.

Deseret News Publishing

Deseret News, Utah’s oldest news publisher, sued Steward Health last November, claiming Steward owes them $76,800 in fees for eight months’ worth of advertising on the news outlet’s website and app.

The complaint alleges Steward agreed to a “section takeover” of Deseret News’ high school sports page, giving the hospital group exclusive advertising rights on that section online and in the Deseret News app. Deseret delivered on its half the agreement, the lawsuit claims, but Steward has not paid eight months’ worth of invoices, despite repeated assurances that payment “would be forthcoming.”

Steward has not responded to Deseret’s complaint; attorneys for Deseret News — which is owned by The Church of Jesus Christ of Latter-day Saints — filed a motion for default judgment in January.

Thomas Cuisine Management

A judge has ordered Steward Health to pay $288,586 in damages to Thomas Cuisine Management, an Idaho company that managed all food and dining services at all five Utah hospitals.

Thomas Cuisine claimed it stopped getting paid for its work in January 2023. It filed a lawsuit last September, seeking six months’ worth of unpaid invoices.

Steward did not respond to the claims, and the court issued a default judgment in November. Thomas Cuisine applied for a writ of garnishment in January to collect the money from Bank of America, which Thomas’ attorneys believe is Steward Health Care’s bank.

Aeroscape Park City LLC

A Utah landscaping company claims its relationship with Steward soured shortly after it started in 2020.

Aeroscape removed snow and ice at all five Utah hospitals, according to a complaint filed in August. But it ended an initial agreement in 2022 after “Steward’s repeated failure to timely pay.”

When Steward couldn’t find anyone else to provide snow removal services, it “urged” Aeroscape to come back, the complaint alleges. Aeroscape agreed, according to the complaint, but with caveats: A new contract required Steward to pay all invoices within 45 days or be subject to a 22% interest late for late payment; and Steward also allegedly agreed to pay Aeroscape’s legal fees should they ever need to settle their debts in court.

Steward has not yet responded to claims against it in this case. The company was served in October, according to court records; nothing has happened since then. Aeroscape is seeking at least $162,980 in damages.

3D Medical Staffing LLC

3D Medical Staffing has filed the largest claim so far against Steward Health, seeking more than $1.7 million. The nursing agency says it provided temporary staffing services to all five Utah hospitals between 2018 and 2023, but Steward stopped paying its invoices in 2021.

This is also one of the few cases where attorneys for Steward have responded to the complaint. In its defense, Steward attorneys admitted that Steward “failed to pay all invoices,” but denied all other allegations in the claim, including that Steward breached its contract with 3D Medical Staffing.

Steward’s attorneys are challenging the amount it owes 3D Medical Staffing, claiming that one of the invoices it received is different than what 3D Medical Staffing presented as evidence. They also claim Steward only received 167 of the 205 invoices in question and has “no record of receiving the other 38.”

Steward’s attorney opposed a motion for summary judgment late last week. A hearing is scheduled for March 19 in front of Judge Barry Lawrence.

Steward did not respond to The Tribune’s request for comment.

Sterile Processing Services of America

Sterile Processing Services of America’s Utah office claims Steward owes $255,438 for unpaid invoices. The California company provided four Utah hospitals with surgical towels and gowns, according to a copy of the contract included in court documents. The company also decontaminated, packaged and sterilized those products for reuse.

Steward “admits that certain invoices remain unpaid,” according to a response filed by Steward’s attorney, but denies other claims and has argued its contracts are “unenforceable.”

The case is in the discovery phase. Steward’s attorney did not respond to a request for comment.

Cases dismissed

Vericel Corporation’s case was dismissed in August after a default judgment was made against Steward for $142,000.

Two other lawsuits filed in 2023 were dismissed for reasons not explained in court documents.

Shannon Sollitt is a Report for America corps member covering business accountability and sustainability for The Salt Lake Tribune. Your donation to match our RFA grant helps keep her writing stories like this one; please consider making a tax-deductible gift of any amount today by clicking here.

Editor’s note • This story is available to Salt Lake Tribune subscribers only. Thank you for supporting local journalism.