State of Tennessee Ex Rel. Herbert H. Slatery, III, Attorney General And Reporter v. HRC Medical Centers, Inc., Et Al.

This is an action brought by the State of Tennessee pursuant to the Tennessee Consumer Protection Act, Tennessee Code Annotated section 47-18-101, et seq., and seeking judicial dissolution, pursuant to Tennessee Code Annotated section 48-24-301, of HRC Medical Centers, Inc., a for-profit corporation operating approximately 50 hormone replacement therapy centers. The State alleged, inter alia, that the corporation’s advertising for its hormone replacement therapy was deceptive, and sought restitution for consumers. Also sued were the owners of HRC and their spouses; it is alleged that those defendants, as recipients of some of the assets of HRC, are personally liable for violations of the Uniform Fraudulent Transfer Act, Tennessee Code Annotated sections 66-3-305(a) and 66-3-306(a). The defendants filed motions to dismiss, for summary judgment, and to remand the case to the Division of Health Related Boards of the Tennessee Department of Health; all of the motions were denied. The State moved for summary judgment on the issue of liability under the Consumer Protection Act and, after the motion was granted, on the issue of damages. In granting the second motion, the trial court entered an award of $18,141,750, based upon the median amount paid by consumers for the hormone therapy treatment. The defendants appeal, raising issues related to the trial court’s denial of their motion for remand, motions to dismiss, and motions for summary judgment; they also appeal the grant of summary judgment to the State. Upon a thorough review of the record, we affirm the judgment.