Louisiana prosecutors are urging a judge to stick to his legal guns and not allow a Maryland firm’s lawsuit against Louisiana to go forward while a grand jury probes a nearly $200 million Medicaid claims processing contract awarded to the company, then canceled earlier this year.
Client Network Services Inc. is suing the state over the Jindal administration’s sudden cancellation of its contract.
State District Judge Tim Kelley, who is presiding over CNSI’s lawsuit, ordered a six-month stay of the civil proceedings July 30 after the state Attorney General’s Office argued for a second time that such a halt was needed to protect the integrity of the wide-ranging criminal investigation.
The judge, who refused in May to put the brakes on the civil case, said in open court July 30 that he based his new decision on investigative files that state prosecutors provided him for a private review.
CNSI filed a written request last month asking Kelley to lift the stay, arguing his ruling was based on secret evidence obtained during a secret meeting and violated the state and federal constitutions.
In a written opposition to CNSI’s request, Assistant Attorneys General Colin Clark, Butch Wilson and David Caldwell insist no such meeting took place between prosecutors and the judge.
“No ‘secret meeting’ took place — the documents were simply delivered to the court for ... review, and the grant of the six-month stay based on this information is not only well within this court’s authority, but also perfectly reasonable, given the massively complex nature of this investigation which involves hundreds of millions of dollars of taxpayer funds,” the prosecutors contend.
Kelley has scheduled a hearing Tuesday on CNSI’s motion to lift the stay.
The state’s attorneys argue that refusing to allow the filing of documents under seal would require the Attorney General’s Office to disclose its trial strategy, which they say is unreasonable and unnecessary.
“By disallowing this process, a court would give an ‘unfair advantage’ to CNSI by allowing it to obtain highly sensitive information to which it is not entitled ...” Clark, Wilson and Caldwell claim.
The prosecutors say the Attorney General’s Office “is taking its rightful position at the front lines in the war against public corruption.”
“This court has seen fit to let law enforcement do its job in rooting out this corruption,” the prosecutors argue.
“The Attorney General’s Office respectfully requests that this court stick to its guns and stand by its decision, which was both wise and just.”
CNSI maintains it did nothing wrong to win the state contract and was fulfilling its contractual obligations properly before it was fired. The company started work in 2012 on a lengthy transition from the work being done by Molina Medicaid Solutions Inc. The changeover had not been anticipated until sometime in 2014.
Gov. Bobby Jindal’s administration canceled CNSI’s multiyear contract in late March after news broke of a federal probe into the contract. Then-state Department of Health and Hospitals Secretary Bruce Greenstein, who had been a CNSI executive, resigned a week later.
In its cancellation notice to CNSI, the state Division of Administration cited improper contact between Greenstein and CNSI officials and employees. CNSI denies any wrongdoing.