Tampa's Laser Spine Institute abruptly closes, lays off hundreds

TAMPA — The Laser Spine Institute abruptly closed its doors and fired its employees on Friday, apparently without warning.

The 14-year-old institute that regularly advertised its minimally invasive spinal procedures notified its more than 500 employees nationwide that it would cease operations, according to a statement issued by the company.

"My heart goes out to our great, dedicated staff who have stuck with us through all of our adversity and worked so tirelessly to help us right the ship," said CEO Jake Brace in a statement. His company bio touts his "turnarounds of some of the nation's most recognizable brands." He was appointed chief financial officer of United Airlines after the Sept. 11 attacks.

The institute has locations in Tampa, Ohio, Arizona and Missouri. Just three years ago, it spent $56 million to open its 176,000-square-foot headquarters at 5332 Avion Park Dr. near Tampa International Airport.

The out-patient surgery center is supposed to close at 8 p.m. on week days. But when a Tampa Bay Times reporter showed up after 6 p.m., the building was already closed and vacant. A woman who declined to identify herself said the staff found out at 3 p.m. that they had all been laid off. All medical appointments were cancelled. The woman said she was a nurse who had to wheel her last patient out.

The driving force in the shutdown, the company statement said, was financial.

"Despite significant cost saving activities over the last 6 months — including closing three surgical centers — that dramatically reduced its operating cost structure, the company has been unable to achieve a financially sustainable path forward," the statement said.

Related coverage: Laser Spine Institute joins ghosts of Tampa Bay businesses past, from Maas Bros to Webb's City

Those financial issues may include a Dec. 28 opinion handed down by the 2nd District Court of Appeal, which overturned an earlier judgment won by a group of doctors from a competing laser spinal surgical center who sued the institute's founding doctors in 2006 in Hillsborough Circuit Court. They accused the institute's founders of breach of fiduciary duty, conspiracy, defamation, slander, tortious interference and violation of the Florida Deceptive and Unfair Trade Practices Act.

The plaintiffs won their suit, records show, but now the appellate court had to settle what damages they were owed. It struck down the trial judge's award of $1.6 million. The plaintiffs argued they were owed "disgorgement" of about $264 million, which they estimated was the Laser Spine Institute's value in 2009 plus $77.5 million paid to the owners from 2005-09.

In legal terms, disgorgement is when one party is compelled to return wrongly obtained profits, both to reimburse the other party for what they may have lost and as a deterrent to keep it from happening again.

The appellate court noted that the "proper amount of the award at a minimum falls between $264,000,000 and $265,000,000."

Follow trends affecting the local economy

Subscribe to our free Business by the Bay newsletter

We’ll break down the latest business and consumer news and insights you need to know every Wednesday.

Loading...

You’re all signed up!

Want more of our free, weekly newsletters in your inbox? Let’s get started.

Explore all your options

In 2018, the institute was also ordered by a Pennsylvania court to pay $20 million to the estate of an Ohio woman who sued after her 2014 death, according to news reports.

No executives at the Laser Spine Institute could be reached for comment on Friday.

Its Tampa facility had 10 operating rooms and 28 recovery beds, according to Florida Agency for Health Care Administration records. The company said it had helped 75,000 patients since 2005.

It made headlines in 2013 when it was sued by professional wrestler Terry "Hulk Hogan" Bollea.

The Laser Spine Institute's patients are being referred to other specialists, according to the company. The institute is contacting surgeons in the cities affected by the shutdown to see if they are able to take on the extra patients, and will "also provide facilities for patients to receive the requisite post-operative care."

Times senior researcher Caryn Baird and staff writer Anastasia Dawson contributed to this report. Contact Malena Carollo at mcarollo@tampabay.com or (727) 892-2249. Follow @malenacarollo.