Scanner service firm loses court case after lengthy battle with GE Medical

CT Repair Service (CTRS) suffered a traumatic turnaround in CaliforniaAppellate Court in February. The three-judge appeals panel inLos Angeles declared GE Medical Systems innocent in the seven-yearscanner service dispute. CTRS was ordered to pay GE's legal costson appeal and was denied a retrial in a lower court, said FredD. Jackson, CTRS owner. GE would not comment on the litigation.

The service executive won a $2.1 million damage award againstGE Medical Systems in Los Angeles Superior Court last year. Hehad accused GE of abusing its position as a manufacturer of imagingsystems to prevent CTRS, an independent service organization,from winning away the vendor's scanner service business at severalCalifornia hospitals (SCAN 1/17/90).

GE filed motions with the court following the verdict, andthe Superior Court judge agreed to order a retrial. The judgedid not, however, grant GE's request for a "judgment notwithstanding the verdict," which would have reversed thejury verdict. GE appealed this decision. The appellate court decidedto overturn the trial judge's order for a retrial and reversedthe original verdict, Jackson said.

"Obviously I am upset, but not so much about the monetaryloss as the message that the court of appeals is sending to smallbusinesses," he said. "I am concerned not only aboutcompetition and fairness in this industry, but also the implicationsfor the cost of health care if manufacturers are given the greenlight to commit what a jury found was fraud, malice and oppression."

Although CTRS is appealing the decision to the California SupremeCourt, chances are slim that the case will be heard by the topstate court, said Richard A. Seltzer, Jackson's attorney.

"We are very concerned about what the appellate courtdid in this case," Seltzer said. "It is unusual forthem to grant an order to overrule the trial judge and grant judgmentto one side or another without a new trial."

Frustrated in court, Jackson is exploring other options. Hehas discussed his case with Rep. Fortney "Pete" Stark(D-CA), chairman of the House Ways and Means subcommittee on health.The congressman referred Jackson to other, more appropriate authorities,said William Vaughan, Stark's administrative assistant.