Prime Healthcare

Stuart Pfeifer
October 24, 2015

Dr. Prem Reddy has frequently been criticized over his tough management, cost-cutting and reduced medical services at Prime Healthcare Services Inc., his fast-growing Ontario-based hospital chain.

But this week the company owner and chief executive found himself at the center of a very different type of controversy — a sex scandal that quietly led to sweeping management changes at an Encino hospital and a $1-million wrongful-termination verdict.

A Los Angeles jury awarded the money Wednesday to the former chief nursing officer of Encino Hospital Medical Center after concluding that she was laid off in 2012 because she had complained about an affair between the hospital’s chief medical officer and a female supervisor.

Prime Healthcare maintains nursing officer Vilma Dinham was let go because of poor performance and said it intends to appeal.

However, testimony during the Los Angeles County Superior Court trial in Van Nuys presents a less than flattering picture of operations at the hospital, which Prime acquired from Tenet Healthcare Corp. in 2008.

The controversy began in 2011, when Dinham complained that the hospital’s director of respiratory services, Hershee Cajigal, had boasted to co-workers that she was having an affair with Dr. Muhammad Anwar, the chief medical officer. She told them she had the power to get them fired, according to the lawsuit Dinham filed in 2013.

Dinham said she complained to Anwar about Cajigal’s comments but they did not stop. So she and other nurses took their concerns to the hospital’s chief executive, Robert C. “Bob” Bills.
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According to a transcript of Bills’ testimony reviewed by The Times, Bills said that he cautioned Cajigal about the inappropriate comments and what he said was her unprofessional work attire, which included low-cut tops, short skirts and 6- to 8-inch heels.

“It was totally inappropriate,” Bills said during the two-week jury trial.

Bills said Anwar scolded him for confronting Cajigal.

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