San Leandro Joins Lawsuit Against Sutter Health

San Leandro city officials have joined the Eden Township Health Care District's fight against a plan to transform San Leandro Hospital into an acute care rehabilitation hospital.

The city today filed a "friend of the court" brief with the California State Court of Appeal, supporting Eden Township's lawsuit against Sutter Health.

The lawsuit states two Sutter Health officials involved in the decision to transform the hospital have financial interests in Sutter Health and that constitutes a conflict of interest. They say the health care company's plan should be invalidated.

"Conflicts with laws governing public agencies must be strictly enforced to ensure the public interest always comes first when agencies transfer public assets to private parties," stated Mayor Stephen Cassidy. "This did not occur here and as a result the medical needs of our community have been placed in jeopardy."

At issue is Sutter Health's desire to change San Leandro Hospital into an acute care rehabilitation hospital for Alameda County. That would mean the elimination of emergency room care and other general services at the hospital.

San Leandro Hospital is owned by Eden Township. However, in 2008, Sutter Health signed an agreement with the district to oversee hospital operations. That included an option to purchase the facility on East 14th Street, something the company would now like to do.

In 2009, Sutter Health signed another agreement with Alameda County Medical Center to transform San Leandro Hospital into an acute care rehabilitation hospital.

Sutter Health officials said they expect Eden Township to honor the agreement they signed and let the proposal move forward.

"We believe we have a legally binding agreement with the district that was approved by the district and outlines the district's authority to enter into the agreement. We are confident that the court will uphold this agreement and we will receive title to San Leandro Hospital, as outlined in that agreement," said Stacey Wells, director of public affairs and communications for Sutter Health's East Bay region.

Eden Township and San Leandro officials say the transformation would deprive the city and central Alameda County of much-needed health care services.

They have embarked on a plan to bring St. Rose Hospital in Hayward into the district as an acute care facility. That would allow San Leandro Hospital to remain a general services complex.