Legal squabble over Medical City continues
The Makati City Prosecutors Office has dismissed the complaint for perjury against Dr. Alfredo Bengzon, founding shareholder and long-time CEO of Professional Services Inc. (PSI) or The Medical City (TMC), lodged by Viva Holdings (Phils.), a Singapore-based private equity fund.
The complaint alleged that Dr. Bengzon lied in his sworn statements to the Securities and Exchange Commission (SEC) that he had no knowledge regarding the Cooperation and Shareholder’s Agreement (CSA) between Viva Holdings and two companies owned by Jose Xavier Gonzales - Fountel Corporation, and Felicitas Antoinette Inc.
The CSA details how the Gonzales – Viva group have been acting in concert since 2013 in acquiring a majority share in PSI, with Viva actually funding Gonzales’ acquisitions.
“We welcome the dismissal of the perjury case against Dr. Bengzon, as this confirms our position that the parties in question indeed failed to properly disclose the true nature of their relationship to the Board of Directors and stockholders of PSI as required by law,” said Atty. Roderico Puno, counsel for Dr. Bengzon.
Puno added that, “the criminal charges of estafa against these same parties now pending before the Pasig Regional Trial Court further validates allegations of fraud.”
In a parallel development, the SEC has charged the Gonzales – Viva group with numerous violations of the country’s Securities Regulation Code (SRC), including fraud.
The SEC found that the group may have “misrepresented their independence from each other,” as they secured majority ownership of PSI, to the prejudice of “unsuspecting stockholders whose share value and voting power have declined” as a result of the fraud.
The SEC stated that these acts violated SRC provisions designed to protect stockholders from “fraudulent, manipulative and deceptive act(s) or practice(s)” in connection with securities transactions.
On the other hand, the Pasig Courts just denied a petition by Margaret A. Bengzon, senior executive of PSI and daughter-in-law of Dr. Bengzon, to issue a writ of preliminary injunction preventing the conduct of stockholders’ meetings and board meetings by PSI Healthcare Development Services Corp. (PHDSC) and other PSI subsidiaries, as well as the corresponding replacement of corporate officers in these subsidiaries.
“We are disappointed by the denial of our petition to stop the Gonzales and Viva companies from together consolidating corporate control, until the SEC has resolved the serious questions before it. The Pasig Court’s decision is erroneous in matters of fact and law, and we are raising this matter to the Court of Appeals,” said Atty. Puno.
He noted that, “the decision is based on a finding that Ms. Bengzon does not have standing in this case as a stockholder of PHDSC since her name is not recorded in the corporation’s stock and transfer book; nor does she have a stock certificate in her name.”
However, Puno said “the Pasig Courts failed to appreciate that Ms. Bengzon has been recognized as a stockholder of record in PHSDC since 2009, based on the corporation’s General Information Sheet, a sworn statement submitted annually to the SEC, and that the corporation has acted consistent with this recognition of her status over all these many years.”
“More importantly, we eagerly await the SEC decision regarding the parties alleged fraudulent acquisition of PSI shares. The SEC decision, when finally issued, will provide definitive and just resolution to PSI current corporate challenges, and will enable the hospital to rechart the course of growth and leadership it has pursued over the last five decades,” said Atty. Puno.