McMurry sues Hardin-Simmons for $1M regarding operation of Shelton nursing school
McMurry University announced Tuesday that it is suing its sister Abilene institution, Hardin-Simmons University, for $1 million for attempting not to sell its interest in Patty Hanks Shelton School of Nursing and threatening to "unilaterally dissolve the program," according to documents for the plaintiff.
The nursing school is located adjacent to the north Abilene campus of Hendrick Medical Center. Established in 1979 as Abilene Intercollegiate School of Nursing and once including Abilene Christian University, the school provides advanced training for students seeking to enter the healthcare profession.
"For decades, PHSSN faithfully served its mission and purpose for the Abilene and greater West Texas communities, but its mission and purpose are now threatened by the unilateral tactics of one member institution, HSU," the court document states. "HSU apparently has been secretly planning for years to usurp sole ownership and all benefits of the joint program and, if unable to do so, HSU now appears willing to eventually dissolve the program in violation of its contractual and fiduciary duties as well as its responsibilities to the students and faculty of PHSSN and the community at large."
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The document, filed Monday in 350th District Court, further states that Hardin-Simmons failed in its attempt to take control of the nursing school and exclude McMurry, and on April 12 "became contractually bound to sell its interests in the consortium to McMurry. HSU, however, almost immediately reneged on its duties and threatened to unilaterally dissolve the program, which it lacks the contractual and legal authority to do so."
In an email to the Reporter-News, Hardin-Simmons offered its statement in response to the lawsuit:
"Hardin-Simmons deeply appreciates the long history of working with the other local universities in the Patty Hanks Shelton School of Nursing. We have been in discussions with McMurry about how each university could continue to provide nursing education in Abilene, and unfortunately, we have not been able to agree on the best path forward.
"We are disappointed that McMurry has chosen to take this matter into court, instead of working together cooperatively, and we will respond to the lawsuit to accurately set forth HSU’s position.
"HSU’s desire is to continue to provide excellent training and education to accommodate the need for quality nursing professionals in our community."
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The court document filed this week condemns Hardin-Simmons for its action two years after a worldwide pandemic and when the need for healthcare workers has escalated.
"McMurry brings this action to enforce its contractual right to acquire and otherwise maintain, protect, and enhance the over 40-year-old nursing program that has so well served the aspiring nursing students and citizens of West Texas," the document states.
McMurry, which is a member of the American Southwest Conference for athletics with HSU, is seeking $1 million and "declaratory and injunctive relief, and all the other relief to which plaintiff shows itself entitled."
ACU has established its own nursing program, while nursing also is offered at nearby Texas Tech University Health Sciences Center and through Cisco College, which offers licensed vocational nursing and a program to advance an LVN to registered nurse.
History of a partnership
The three universities participated in the nursing school until 2002, each offering undergraduate programs that educated students in preparation for clinical training at then-Abilene Intercollegiate School of Nursing.
The institutions shared administrative and salary costs, working with Hendrick Medical Center.
The school in 2002 was dissolved as a nonprofit and reorganized to "become an academic program co-managed by the three accredited institutions as opposed to a separate legal entity," according to background included in the court document.
On Dec. 31, 2005, the name was changed to Patty Hanks Shelton School of Nursing.
On Oct. 31, 2010, ACU notified HSU and McMurry that it would be withdrawing, giving a required three-year notice. ACU opened its own school on campus.
The withdrawal became effective June 1, 2012. ACU was awarded $1 million in compensation for its financial contribution to the nursing school over time.
McMurry and HSU shared operation of the school for the past 10 years.
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Now at odds
The document states Hardin-Simmons in 2013 contacted McMurry about selling its interest in the nursing school, but McMurry declined.
In 2015, HSU entered into a contractual agreement to become the coordinating institution for the consortium.
A second attempt, according to the document, was made in October by Hardin-Simmons to acquire sole control of the school, or "start its own nursing program to commence operations in the 2023-24 academic year, which could be operated in direct competition with (the nursing school)."
At the time, it was shown that McMurry's undergraduate nursing program accounted for 8% of total enrollment. Thus, the loss of the nursing school "would have a material adverse effect on McMurry's overall operating revenue," the document states.
McMurry on Dec. 16 declined HSU's offer.
In March, HSU offered a buy-sell proposal - offering to buy out McMurry or allow McMurry to buy out HSU on the same terms.
On April 12, McMurry answered with an offer to buy out HSU.
However, in meetings and correspondence that took place after that, an agreement plan fell apart, the document states.
At a May 31 Zoom meeting, the document states, "representatives of HSU denied the existence of a contract between McMurry and HSU by which McMurry could purchase HSU’s interest in PHSSN. HSU’s denial of the existence of the contract during the May 31 Zoom Conference was McMurry’s first indication of the existence of any potential dispute between the parties."
Eventually, Hardin-Simmons attempted to dissolve the nursing school rather than allow McMurry to take control, the document states.
Greg Jaklewicz is editor of the Abilene Reporter-News and general columnist. If you appreciate locally driven news, you can support local journalists with a digital subscription to ReporterNews.com.
This article originally appeared on Abilene Reporter-News: McMurry sues HSU for $1M regarding operation of Shelton nursing school
