LEGAL129706847.2 

IN THE UNITED STATES BANKRUPTCY COURT 

FOR THE EASTERN DISTRICT OF VIRGINIA 

RICHMOND DIVISION 

In re: 

HEALTH DIAGNOSTIC LABORATORY, 

INC., et al., 

Debtors.1

Chapter 11 

Case No. 15-32919 (KRH) 

(Jointly Administered) 

HEALTH DIAGNOSTIC LABORATORY, 

INC., 

Plaintiff, 

v. 

TRUE HEALTH DIAGNOSTICS, LLC, and 

JEFFREY P. “BOOMER” CORNWELL, 

Defendants. 

Adv. Pro. No. 16-03011 (KRH) 

DEFENDANTS’ RESPONSE IN OPPOSITION TO MOTION OF PLAINTIFF FOR 

ENTRY OF AN ORDER EXPEDITING CONSIDERATION OF, AND SHORTENING 

THE NOTICE PERIOD APPLICABLE TO, MOTION FOR A TEMPORARY 

RESTRAINING ORDER, PRELIMINARY INJUNCTION, AND ORDER TO SHOW 

CAUSE FOR WILLFUL VIOLATIONS OF THE AUTOMATIC STAY, 

AND MEMORANDUM IN SUPPORT 

 Defendants True Health Diagnostics, LLC (“True Health”) and Jeffery P. “Boomer” 

Cornwell (“Cornwell” and together with True Health, “Defendants”), by its undersigned counsel, 

hereby files their response in opposition to Motion of Plaintiff for Entry of an Order Expediting 

Consideration of, and Shortening the Notice Period Applicable to, Motion for a Temporary 

 

1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification number, are: 

Health Diagnostic Laboratory, Inc. (0119), Central Medical Laboratory, LLC (2728) and Integrated Health Leaders, 

LLC (2434).

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Restraining Order, Preliminary Injunction, and Order to Show Cause for Willful Violations of 

the Automatic Stay, and Memorandum in Support (the “Motion to Expedite”) and in support 

thereof, submits as follows: 

PRELIMINARY STATEMENT

 Plaintiff’s adversary proceeding and motion for immediate injunctive relief arise from a 

pending contract dispute between Plaintiff and True Health regarding the correct interpretation of 

certain sections of the Asset Purchase Agreement for the Section 363 sale of substantially all 

Plaintiff’s assets to True Health. It is not, as Plaintiff’s suggest in their pleadings, some abrupt 

action taken by True Health that violates the automatic stay or justifies immediate injunctive 

relief, much less an expedited hearing for a temporary restraining order on less than 48-hours’ 

notice. Indeed, after True Health expressed its serious concerns regarding Plaintiff’s improper 

collection efforts and tortious interference with True Health’s client relationships more than one 

month ago, Plaintiff voluntarily agreed to discontinue their wrongful collection actions (which 

agreement has continued for more than three weeks), while the parties attempted to resolve the 

issue without court involvement. Plaintiff cannot now be heard to complain that it will be 

irreparably harmed from engaging in conduct it voluntarily agreed to discontinue and has 

discontinued for weeks. Nor can it justify an expedited hearing on its request for a temporary 

restraining order on less than 48-hours’ notice. 

 It now appears that instead of engaging in good faith negotiations with True Health, 

Plaintiff was instead preparing to ambush Defendants with an improvidently filed adversary 

complaint and motion for immediate injunctive relief to attempt to gain a tactical litigation 

advantage. This improper motive is underscored by Plaintiff’s counsel’s failure to even attempt 

to contact Defendants’ counsel to engage in a bona fide effort to resolve this matter without a 

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LEGAL129706847.2 

hearing, despite Plaintiff’s Rule 9013-1(N) certification to the contrary. As explained in detail 

below, the Court should deny the Motion to Expedite because (1) Plaintiff fails to demonstrate 

irreparable harm with respect to its ability to pursue disputed collection actions that it voluntarily 

agreed to discontinue (and has discontinued) for nearly one month; (2) Plaintiff fails to articulate 

how Defendants’ attempts to protect themselves against post-petition torts violate the automatic 

stay or justify an immediate TRO hearing; (3) Plaintiff fails to explain why money damages 

would not be a sufficient remedy; (4) Plaintiff does not allege how True Health has failed or 

refused to provide information to Plaintiff or why such failure necessitates an immediate TRO 

hearing; (5) Plaintiff falsely certified that it made a bona fide effort to resolve the Motion to 

Expedite; and (6) Plaintiff improperly noticed the hearing for a temporary restraining order. 

BACKGROUND FACTS

 On September 17, 2015, the Court entered an order approving the Asset Purchase 

Agreement entered into between True Health, as buyer, and Plaintiff and Integrated Health 

Leaders, LLC, as sellers (the “APA”), authorizing the sale of substantially all of Plaintiff’s assets 

to True Health free and clear of all claims (the “Sale”) and granting related relief. See Docket 

No. 512. On September 29, 2015, the parties closed the Sale, and True Health purchased the 

majority of Debtors’ operational assets and hired nearly all of Debtors’ workforce, totaling more 

than 375 employees. The Sale was hailed by the Court and all parties as a tremendous success 

under very difficult circumstances. After the Sale closed, True Health worked collaboratively 

with Plaintiff and its professionals to collect current accounts receivables purchased by True 

Health, and used the proceeds to repay the full principal amount of the $10 million seller note 

plus over $2 million of interest and additional principal well before the January 31, 2016 

maturity date, providing additional, unexpected proceeds to Plaintiff’s estate. 

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 Shortly after these proceeds were paid over to Plaintiff’s estate, True Health began 

receiving disturbing reports from its clients that former patients of Plaintiff (and current patients 

of True Health) were receiving aggressive and harassing collection notices from a Florida 

collection agency called Accelerated Receivables Management (“ARM”) for services performed 

many years ago that were never billed to these patients and written by Plaintiff pursuant to their 

express billing policy. Upon further investigation into this issue, True Health received 

documentation of abusive and unlawful collection actions committed by ARM against True 

Health patients, including pursuing collections in jurisdictions that ARM was not authorized to 

collect debts and making false representations that ARM was pursuing these collections on 

behalf of the Department of Justice and True Health (neither of which is true). As a result of 

these improper collection actions committed by ARM on behalf of Plaintiff, current clients of 

True Health threatened to discontinue—and in many cases have discontinued—all future 

business with True Health, thereby jeopardizing the viability of True Health’s business and 

threatening to undo the success achieved as a result of the Sale that closed just a few short 

months ago. 

 Immediately upon learning of these collection actions instituted by ARM, True Health 

contacted Plaintiff to inquire into the basis of these collections and advise Plaintiff regarding the 

reports of ARM’s unlawful collection practices. In response to these inquiries, Plaintiff 

confirmed with True Health that they had authorized ARM to initiate collection actions directly 

against patients for services allegedly provided as far back to 2009 despite the fact that, among 

other things, Plaintiff had never billed patients for these alleged receivables, Plaintiff had 

expressly waived the right to pursue these types of collections directly against patients pursuant 

to their contracts with physician offices and patients, and Plaintiff’s published billing policies, 

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Plaintiff had long ago written off these alleged receivables and obtained certain tax benefits from 

the write-offs, and Plaintiff never disclosed these written-off debts as potential assets during the 

Sale process that would be retained by the estate as assets under Section 2.2 of the APA, nor 

were these alleged assets expressly carved out as an Excluded Asset in Schedule 2.2(m) of the 

APA. Plaintiff’s counsel refused to take any action to temporarily forbear from these collection 

actions or inquire into the numerous complaints of improper collection practices by ARM. 

 As a result, on January 5, 2016, True Health sent a cease and desist letter to ARM 

demanding that it immediately cease and desist from tortuously interfering with True Health’s 

patient relationships. That same day, True Health sent a cease and desist letter to Plaintiff 

demanding that the estate immediately instruct ARM to cease and desist these improper 

collection activities. True and correct copies of the cease and desist letters are attached hereto as 

Exhibit A. 

 Shortly after sending the cease and desist letters, True Health and Plaintiff engaged in 

discussions in an attempt to resolve the issue without court involvement. As a result of those 

discussions, True Health made a substantial offer of more than $1 million to resolve the parties’ 

disputes. Plaintiff represented that they would consider it in good faith, but needed additional 

time to review information to better evaluate the offer. 

 On January 8, 2016, counsel for True Health and Plaintiff participated in a telephone 

conference during which Plaintiff’s counsel voluntarily agreed that the estate would instruct 

ARM to discontinue any collection actions with respect to the most harmful and egregious 

collection actions directed against patients who never received a bill from Plaintiff or a check 

from their insurance carrier—the “third batch” of collection information Plaintiff had previously 

sent to ARM for collection (the “Patient Responsibility Collections”). The following business 

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day, on Monday, January 11, 2016, Plaintiff’s counsel confirmed that conversation and 

represented that “[t]he Debtors have asked that ARM not take further collection steps at this time 

with respect to a third batch previously sent to ARM.” Plaintiff’s counsel also requested that 

True Health provide Plaintiffs with additional information relating to Plaintiff’s collection efforts 

with respect to the first two batches, which True Health provided to Plaintiff just a few days 

later. A true and correct copy of the email exchange reflecting these conversations is attached 

hereto as Exhibit B. 

 The next correspondence True Health received from Plaintiff was an email from 

Plaintiff’s counsel on the afternoon of February 1, 2016, stating that Plaintiff was rejecting True 

Health’s offer (without any reason or counteroffer) and was instead pursuing litigation against 

Defendants by filing its adversary complaint, motion for injunctive relief, and the Motion to 

Expedite. See Docket No. 802. It now appears that Plaintiff was not negotiating with True 

Health in good faith, but rather misleading True Health in an attempt to gain an improper 

litigation advantage. Plaintiff’s deceptive tactics should not be sanctioned by the Court and 

undermine Plaintiff’s request for the expedited relief it seeks in the Motion to Expedite. 

LEGAL ARGUMENT

A. Plaintiff Fails to Demonstrate Irreparable Harm Requiring An Immediate TRO 

 Hearing 

 The first basis for Plaintiff’s request for an immediate hearing on its motion for a 

temporary restraining order (the “TRO Hearing”) is that it will suffer irreparable harm if 

Defendants are not immediately enjoined because “HDL and its estate stand to suffer the loss of 

significant amounts in uncollected Excluded Receivables.” Mot. to Expedite at ¶ 14. That 

justification completely overlooks the fact that Plaintiff already voluntarily agreed, more than 

three weeks ago, to discontinue the collection actions with respect to the Patient Responsibility 

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Collections at issue in its motion. Consequently, there can be no risk of irreparable harm with 

respect to collection activities that Plaintiff is not currently pursuing. Defendants have not 

interfered, and have no intent to interfere, with any other lawful and authorized collection actions 

with respect other alleged accounts receivable owned by Plaintiff. Furthermore, Plaintiff fails to 

identify what ongoing and continuing actions Defendants are allegedly taking that might possibly 

interfere with the ARM Agreement and so-called Patient Obligations. The only evidence 

submitted in support of Plaintiff’s complaint and motion are correspondence from nearly a 

month ago, all of which pre-date Plaintiff’s agreement to discontinue the Patient Responsibility 

Collections. Plaintiff makes no allegations of any ongoing or continuing conduct committed by 

Defendants after Plaintiff’s agreement to stop the Patient Responsibility Collections that would 

justify an immediate TRO Hearing. 

 The second basis for Plaintiff’s request is that if Defendants are not required to show 

cause as to why they should not be held in contempt for violating the automatic stay, then such 

stay violations “likely will continue and HDL’s estate and creditors will suffer irreparable harm.” 

Mot. to Expedite at ¶ 14. Plaintiff’s argument misconstrues the application of the automatic stay 

to the claims at issue in this case. It is well established that the automatic stay “is limited to 

actions that could have been instituted before the petition was filed or that is based on claims that 

arose before the petition was filed. It does not include actions arising post-petition.” Bellini 

Imports, Ltd. v. Mason & Dixon Lines, Inc., 944 F.2d 199, 310 (4th Cir. 1991). Here, True 

Health’s attempts to prevent Plaintiff and ARM’s tortious interference with True Health’s clients 

and business relationships based on a flawed interpretation of the APA all concern post-petition 

conduct that is not subject to the automatic stay. Plaintiff offers no evidence True Health has 

ever attempted to collect or obtain possession of any alleged asset of the bankruptcy estate; 

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rather, True Health attempted to protect itself against post-petition tortious interference with its 

business relationships. Accordingly, the automatic stay does not apply and there is no risk of any 

continuing stay violations that would rise to the level of irreparable harm. Even if there was a 

potential stay violation, and such violation was ongoing—neither of which are true—Plaintiff 

fails to articulate how the “HDL’s estate and creditors will suffer irreparable harm.” Mot. to 

Expedite at ¶ 14. Indeed, none of Plaintiff’s pleadings allege any ongoing conduct by True 

Health that presents an immediate and irreparable threat of a continuing stay violation or harm to 

Plaintiff’s estate. 

 The third and final basis for Plaintiff’s request for an immediate TRO Hearing is that 

Plaintiff “will suffer substantial injury because HDL will be unable to collect some or all of the 

Excluded Receivables and will lose the portion of the collection proceeds it is entitled to receive 

from the collection of Purchased Receivables.” Mot. to Expedite at ¶ 14. As explained above, 

Plaintiff already voluntarily agreed more than three weeks ago not to pursue the Patient 

Responsibility Collections, so there is no current, immediate threat of irreparable harm. 

Moreover, even if there were a risk that Plaintiff might “lose the portion of the collection 

proceeds it is entitled to receive from the collection of Purchase Receivables,” such loss could be 

compensated through an award of money damages. The Fourth Circuit has recognized that 

“[w]here the harm suffered by the moving party may be compensated by an award of money 

damages at judgment, courts generally have refused to find that harm irreparable.” Hughes 

Network Sys., Inc. v. InterDigital Commc'ns Corp., 17 F.3d 691, 694 (4th Cir. 1994). Plaintiff 

has failed to allege any “extraordinary circumstances” required to find irreparable harm when 

money damages would suffice. Id. 

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B. True Health Has Provided Plaintiff with Appropriate Access to Information

 In its pleadings, Plaintiff alleges that True Health has refused to provide Plaintiff with 

access to the books and records it acquired as part of the Sale. See Adv. Compl. at ¶¶ 102-03. 

Section 2.1(h) of the APA provides that True Health acquired all of Plaintiff’s Books and 

Records as part of the Sale. See APA § 2.1(h), attached as Exhibit A to Adv. Compl. Plaintiff 

alleges that True Health has refused to provide information relating to Plaintiff with information 

concerning the Excluded Receivables in violation of Section 10.3 of the APA. See Adv. Compl. 

at ¶ 103. That section requires True Health to provide Plaintiff with “reasonable access” to its 

books and records and expressly excludes any attempts “to interfere unreasonably with the 

operation of the business of any party.” APA § 10.3. Here, Plaintiff fails to make any specific 

allegation that it requested information from True Health and True Health failed or refused to 

provide that information. Instead, True Health has timely provided Plaintiff with information it 

requested relating to the collection of accounts receivables, as illustrated by Exhibit B. 

Accordingly, Plaintiff’s unsupported allegations regarding True Health’s failure or refusal to 

provide Plaintiff with reasonable access to information pursuant to Section 10.3 of the APA rings 

hollow and does not support the need for an immediate TRO Hearing. 

C. Plaintiff Did Not Make a Bona Fide Effort to Resolve the Scheduling of the TRO 

 Hearing 

Local Rule 9013-1(N) requires a party requesting an expedited hearing to certify, among 

other things, that the party “has made a bona fide effort to resolve the matter without hearing.” 

Plaintiff’s counsel attached a Rule 9013-1(N) certification to the Motion to Expedite, declaring 

that he “made a bona fide effort to resolve the matter without hearing.” That declaration is false. 

Plaintiff did not even contact True Health before filing the Motion to Expedite, let alone attempt 

to resolve the requested relief to expedite the TRO Hearing before filing the Motion to Expedite 

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and executing the Rule 9013-(N) certification. For that reason alone, the Motion to Expedite 

should be denied. 

D. Plaintiff Improperly Noticed the Hearing on the Motions

 Plaintiff’s Notice of Motion and Notice of Hearing filed in connection with the Motion to 

Expedite states that “if the Motion to Expedite is granted” then there will be a hearing on 

February 3, 2016 at 2:00 p.m. prevailing Eastern Time. However, the docket entry on the 

Court’s ECF system reflects that a hearing has been scheduled for February 3, 2016 at 10:00 a.m. 

Plaintiff has failed to reconcile this inconsistency or otherwise confirm with Defendants when 

the proposed hearing is scheduled to occur. 

E. The Court Should Set a More Reasonable Schedule to Resolve Plaintiff’s Request 

 for Injunctive Relief 

 As explained above, Plaintiff has failed to demonstrate the type of immediate and 

irreparable harm required to obtain the extraordinary relief of holding a TRO Hearing on less 

than 48-hours’ notice. It appears that Plaintiff seeks such an expedited hearing not to protect a 

legitimate, immediate interest, but rather to obtain a litigation advantage over Defendants. This 

is particularly true because Plaintiff’s alleged irreparable harm relates to collection practices that 

it voluntarily agreed to stop more than three weeks ago and is not currently pursuing. The Court 

should not sanction Plaintiff’s gamesmanship, which is designed to impart undue prejudice on 

Defendants. Instead, Defendants propose that the Court adopt the objection deadline of 

February 12, 2016 and hearing date of February 16, 2016 originally proposed by Plaintiff for the 

preliminary injunction hearing for the TRO Hearing, with the preliminary injunction hearing to 

occur two weeks later. That reasonable proposal continues the proposed TRO Hearing for only 

seven business days, provides Defendants with a reasonable opportunity to respond to Plaintiff’s 

allegations, and will allow the Court to make more informed decision regarding the propriety of 

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LEGAL129706847.2 

a temporary restraining order. Furthermore, there is no prejudice to Plaintiff in adopting this 

schedule. 

 In any event, Defendants’ counsel has informed Plaintiff’s counsel that it has a conflict 

that will prevent him from appearing at hearing in Richmond, Virginia on February 3, 2016. 

Accordingly, if the Court is unwilling to adopt the short extension of time proposed above, 

Defendants request that a hearing on the Motion to Expedite be at least continued to February 5, 

2016. 

CONCLUSION 

 For the forgoing reasons, the Court should deny the Motion to Expedite. 

Dated: February 2, 2016 By: /s/ H. Slayton Dabney, Jr.

Dabney, PLLC 

H. Slayton Dabney, Jr. (VSB No. 14145) 

303 Grande Court 

Richmond, VA 23229 

Phone: (646) 549-1181 

sdabney@dabneypllc.com 

-andEric E. Walker 

PERKINS COIE LLP 

131 South Dearborn Street, Suite 1700 

Chicago, IL 60603-5559 

Telephone: 312.324.8400 

Facsimile: 312.324.9400 

Attorneys for Defendants 

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EXHIBIT A

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©2010 Health Diagnostic Laboratory, Inc. |  1.877.4HDLABS (1.877.443.5227)  |  www.myhdl.com                               HDL‐161.7

Health Diagnostic Laboratory, Inc. (HDL, Inc.) Pricing Overview

 MEDICARE / MEDICAID

 The entire cost ofservices performed by HDL, Inc. is covered under current Medicare/Medicaid

requirements.

 PPO’s, POS & HMO Plans:

 HDL, Inc. will accept the amount your insurance company allowsfor each diagnostic.

 If it turns out your insurance company does not cover a specific test, HDL, Inc. assumes all   

the risk.

Below you will find an example of a document that you may receive from your insurance company. This is

an explanation of the insurance claim (Explanation of Benefits). IT IS NOT A BILL, so do not send payment

when it is received. Read the document carefully as different insurance companies label their documents

differently.  

THE BENEFITS SUMMARY OF YOUR CLAIM IS NOT A BILL.

IMPORTANT

If your insurance company sends a check directly to you, rather  

than HDL, Inc., please sign the back of the check and write “Pay to  

the Order of HDL, Inc.” and forward to the address to the right.  

Include a copy of your Explanation of Benefits.

WILL PATIENTS RECEIVE A BILL FROM HDL, Inc.?

There are THREE instancesin which a patient would receive a bill fromHDL, Inc.:   

1) If HDL, Inc. learns that payment for services was sent directly to the patient and not forwarded to our billing

department asrequested above.  

2) Ifthe patient does not have Medical Insurance or optsforservices atthe Cash Price.

3) If HDL, Inc. has filed claims with the patient’s insurance company and the patient has NOT met the

patient contribution requirements (i.e. deductibles, co‐pays, etc.) for laboratory services.

Thank you for trusting HDL, Inc. with an integral part of your healthcare!

Health Diagnostic Laboratory, Inc.

Attention:  Billing Department

737 N. 5th Street, Suite 103

Richmond, VA 23219

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737 North 5th Street, Suite 103,   Richmond VA   23219    Phone: 804.343.2718   Fax: 804.343.2704

Thank you for considering trusting HDL, Inc. with your laboratory testing. We are excited 

by the opportunity. Mr. Johnson told me that you were interested in receiving our billing 

policy explanation directly from HDL, Inc. 

We at HDL, Inc. are dedicated to both the physician and patient partnership in order to 

prevent events. Our goal is to provide quality testing that will help you identify where on 

the disease continuum that a patient sits and to provide the tools you need to get that 

patient back to a healthy state. A key component to achieving our goals is patient 

accessibility. Therefore, we internally control costs, at no sacrifice to quality, and have 

adopted the billing policy where we do not balance bill the patient for costs not covered by 

their insurance companies. The out of pocket expense to the patient with insurance is zero. 

There are only three instances in which a patient will ever receive a bill from HDL, Inc.: 

 If the patient receives a check from their insurance company to cover our services 

and has not forwarded that check to our billing department (this has never 

happened to date); 

 If the patient does not have medical insurance and opts for services at the cash 

price; 

 If HDL is “In-Network” and the patient has not met their contribution requirements 

(i.e. co-pays and deductibles) for lab services with their insurance company. These 

expenses are minimal and typically less than $20. 

 

Please do not hesitate to give me a call with any questions you might have. I can be 

reached at 804-325-1122, directly or on my mobile at 804-986-3660. Again we greatly 

appreciate the opportunity and look forward to our partnership. 

Best regards, 

Tonya Mallory, President and CEO 

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©2010 Health Diagnostic Laboratory, Inc. |  1.877.4HDLABS (1.877.443.5227)  |  www.myhdl.com                               HDL‐161.7

Health Diagnostic Laboratory, Inc. (HDL, Inc.) Pricing Overview

 MEDICARE / MEDICAID

 The entire cost ofservices performed by HDL, Inc. is covered under current Medicare/Medicaid

requirements.

 PPO’s, POS & HMO Plans:

 HDL, Inc. will accept the amount your insurance company allowsfor each diagnostic.

 If it turns out your insurance company does not cover a specific test, HDL, Inc. assumes all   

the risk.

Below you will find an example of a document that you may receive from your insurance company. This is

an explanation of the insurance claim (Explanation of Benefits). IT IS NOT A BILL, so do not send payment

when it is received. Read the document carefully as different insurance companies label their documents

differently.  

THE BENEFITS SUMMARY OF YOUR CLAIM IS NOT A BILL.

IMPORTANT

If your insurance company sends a check directly to you, rather  

than HDL, Inc., please sign the back of the check and write “Pay to  

the Order of HDL, Inc.” and forward to the address to the right.  

Include a copy of your Explanation of Benefits.

WILL PATIENTS RECEIVE A BILL FROM HDL, Inc.?

There are THREE instancesin which a patient would receive a bill fromHDL, Inc.:   

1) If HDL, Inc. learns that payment for services was sent directly to the patient and not forwarded to our billing

department asrequested above.  

2) Ifthe patient does not have Medical Insurance or optsforservices atthe Cash Price.

3) If HDL, Inc. has filed claims with the patient’s insurance company and the patient has NOT met the

patient contribution requirements (i.e. deductibles, co‐pays, etc.) for laboratory services.

Thank you for trusting HDL, Inc. with an integral part of your healthcare!

Health Diagnostic Laboratory, Inc.

Attention:  Billing Department

737 N. 5th Street, Suite 103

Richmond, VA 23219

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737 North 5th Street, Suite 103,   Richmond VA   23219    Phone: 804.343.2718   Fax: 804.343.2704

Thank you for considering trusting HDL, Inc. with your laboratory testing. We are excited 

by the opportunity. Mr. Johnson told me that you were interested in receiving our billing 

policy explanation directly from HDL, Inc. 

We at HDL, Inc. are dedicated to both the physician and patient partnership in order to 

prevent events. Our goal is to provide quality testing that will help you identify where on 

the disease continuum that a patient sits and to provide the tools you need to get that 

patient back to a healthy state. A key component to achieving our goals is patient 

accessibility. Therefore, we internally control costs, at no sacrifice to quality, and have 

adopted the billing policy where we do not balance bill the patient for costs not covered by 

their insurance companies. The out of pocket expense to the patient with insurance is zero. 

There are only three instances in which a patient will ever receive a bill from HDL, Inc.: 

 If the patient receives a check from their insurance company to cover our services 

and has not forwarded that check to our billing department (this has never 

happened to date); 

 If the patient does not have medical insurance and opts for services at the cash 

price; 

 If HDL is “In-Network” and the patient has not met their contribution requirements 

(i.e. co-pays and deductibles) for lab services with their insurance company. These 

expenses are minimal and typically less than $20. 

 

Please do not hesitate to give me a call with any questions you might have. I can be 

reached at 804-325-1122, directly or on my mobile at 804-986-3660. Again we greatly 

appreciate the opportunity and look forward to our partnership. 

Best regards, 

Tonya Mallory, President and CEO 

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EXHIBIT B

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1

From: Walker, Eric E. (Perkins Coie) 

Sent: Friday, January 15, 2016 4:02 PM 

To: 'Harbour, Jason' 

Cc: Brown, Tyler 

Subject: RE: HDL Collection Efforts 

Jason: 

In response to your inquiry below for additional information relating to the first batch of receivables consisting of 

approximately 5,300 accounts, I have attached a spreadsheet that contains the additional information requested. 

Can you please provide me with an update on the status of HDL’s evaluation of True Health’s offer to resolve the patient 

responsibility collection issues? We believe our offer, which exceeds the offer the HDL estate previously made to resolve 

this issue just a few months ago, provides immediate and significant value to the estate, and would likely mitigate further 

confusion and potential legal action relating these controversial collection actions. 

Thank you. 

Eric Walker | Perkins Coie LLP 

PARTNER 

131 S. Dearborn Street Suite 1700 

Chicago, IL 60603-5559 

D. +1.312.324.8659 

F. +1.312.324.9659 

E. EWalker@perkinscoie.com

From: Harbour, Jason [mailto:jharbour@hunton.com] 

Sent: Monday, January 11, 2016 5:14 PM 

To: Walker, Eric E. (Perkins Coie) 

Cc: Brown, Tyler 

Subject: RE: HDL Collection Efforts 

Eric: 

Good afternoon. 

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2

After looking into this matter further, it appears that there are two batches of receivables the Debtors have asked ARM 

to pursue at this time. The Debtors have asked that ARM not take further collection steps at this time with respect to a 

third batch previously sent to ARM. 

The first batch was sent to ARM on or about August 10th, and consisted of approximately 5,300 accounts with a total 

amount owed of approximately $13.7 million. The file sent to ARM does not identify the insurance company, if any, 

related to these receivables. Rick has asked TH on a number of occasions for additional information about this batch, as 

current TH employees were involved with providing this batch to ARM. In particular, Rick has asked for full information 

about each of these receivables, including any related insurance companies, and the search terms used to generate this 

particular list. Please have TH provide the Debtors with additional information about these accounts. 

The second batch sent to ARM consists of approximately 3,476 accounts with a total amount owed of approximately 

$11.8 million. These accounts are related to BC/BS. 

For the accounts in both batches, the Debtors have asked that ARM place collection of an account on hold for 30 days if 

an obligor informs ARM that the obligor did not receive payment with respect to the amount owed. The Debtors also 

have asked ARM to take no further action at this time if the obligor proves to ARM that the obligor was not paid by an 

insurer. 

Please let me know if you have any questions or if you would like to discuss. 

Best, 

Jason 

From: Harbour, Jason 

Sent: Friday, January 08, 2016 5:52 PM 

To: Walker, Eric E. (Perkins Coie) 

Cc: Brown, Tyler 

Subject: Re: HDL Collection Efforts 

Eric: 

We are still confirming the facts. We will provide you with an update on Monday. 

Best, 

Jason 

On Jan 8, 2016, at 5:50 PM, Walker, Eric E. (Perkins Coie) <EWalker@perkinscoie.com> wrote: 

Jason:

This email will confirm our conversation this morning where you communicated to me that the HDL 

bankruptcy estate has instructed ARM, and ARM has agreed, to limit their collections of purported HDL 

accounts receivables only to Blue Cross Blue Shield patients and only for so-called “paid-to-patient” 

accounts, i.e., where patients received a check from BCBS but did not pass that payment on to 

HDL. You further explained to me that if certain BCBS patients who are contacted by ARM did not, in 

fact, receive a check from BCBS and inform ARM accordingly, ARM will suspend collection efforts for 30 

days to provide the patient an opportunity to obtain proof that they did not receive a check from BCBS. If 

the patient provides such proof, then ARM will cease all collection actions against that patient.

If I have misunderstood our conversation or the current status of collection activity with respect to HDL 

accounts receivable, please let me know immediately. 

Case 16-03011-KRH Doc 6 Filed 02/02/16 Entered 02/02/16 02:14:22 Desc Main

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3

Otherwise, we look forward to working with you to reach an agreement that will resolve this issue for 

good. 

Thank you.

Eric Walker | Perkins Coie LLP

PARTNER

131 S. Dearborn Street Suite 1700

Chicago, IL 60603-5559

D. +1.312.324.8659

F. +1.312.324.9659

E. EWalker@perkinscoie.com

 

NOTICE: This communication may contain privileged or other confidential information. If you have received it in error, please advise the 

sender by reply email and immediately delete the message and any attachments without copying or disclosing the contents. Thank you.

Case 16-03011-KRH Doc 6 Filed 02/02/16 Entered 02/02/16 02:14:22 Desc Main

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