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N.C. Superior Court Judge Dismisses 9 of 12 Claims by Former Employees of New River Behavioral HealthCare

By Jesse Wood

July 17, 2014. One year after a federal court judge dismissed a lawsuit filed by former New River Behavioral HealthCare employees against several counties, which included Watauga, and New River Service Authority board members, who included Nathan Miller, chair of the Watauga County Board of Commissioners, N.C. Superior Court Judge Jeff Hunt dismissed nine of the 12 claims by the former employees.

After reviewing the 60-page complaint, Hunt found last week that many of the allegations by the plaintiffs were “redundant, irrelevant, immaterial, impertinent, and/or scandalous and should, therefore, be stricken.”

This was good news to Miller’s ears.

“For the most part, the plaintiff’s claims, through they made good headlines, were not serious claims and were baseless,” Miller said. “It’s not entirely done but the vast majority has been thrown out of court. This would make the second court to have thrown it out. The first time federal court dismissed it entirely and now the state court dismissed most of it.”

This lawsuit was filed in the aftermath of the collapse of New River Behavioral Healthcare, which existed for more than 40 years before its financial demise in 2011. In 2006, an interlocal agreement between five counties (Ashe, Alleghany, Avery, Wilkes and Watauga) came to be, creating the New River Service Agency as a provider of mental health services, developmental disability and substance abuse services in each of those counties. The counties locked into the agreement and elected officials such as Miller representing the counties within the NRSA were among those being sued.

“The dissolution of New River was hard on everybody, but the hard work of final members of board of directors ensured a transition for patients and employees to the new provider, which was Daymark, as seamless as possible,” Miller said.

Months after the collapse, 79 former New River Behavioral HealthCare employees filed its lawsuit in federal court, alleging fraud, negligence, conspiracy and breach of contract.

That lawsuit was struck down in 2013 and then entered state court, where Miller said the employees were asking for about $1 million – essentially for sick pay and vacation pay that Miller says New River doesn’t have to pay. Ashe County Attorney John Kilby also noted at the time that the plaintiffs “vaguely alleged that there’d been a violation of the constitution and a misappropriation of federal monies.”

About the time the case in federal court was struck down in 2013, the New River Service Authority settled with 18 employees that were asking for $90,000 for lost vacation pay but ended up agreeing to settle for $25,000.

“Their demands were reasonable and worked within the money we had,” Miller said last year after the settlement was announced. “It’s the reason why we worked with these guys.”

As for the other three claims that weren’t dismissed, Miller said plans are to gather more information of those claims through the discovery process. He added that he wasn’t “extremely worried,” though, because “they have yet to prove their claims.”

Read the court’s decision here. PLDG – Order on Defendant’s Motion to Strike and Motion to Dismiss