Alabama Supreme Court Orders Lindberg and Company to Pay $11M Note to Med Firm

The legal and financial troubles for former insurance executive and international businessman Greg Lindberg, now awaiting a second trial on charges that he tried to bribe a state insurance commissioner, has spread far beyond North Carolina and has continued to have an impact on businesses in Alabama and other states.

The Alabama Supreme Court last week upheld a trial court’s ruling that Lindberg and his Eli Global LLC investment firm owe more than $11 million to the former owners of an Alabama-based company that has hemophilia treatment centers in five states.

The high court remanded part of the case to the Mobile County Circuit Court, asking the judge to explain how the $224,345 in attorney fees owed by Lindberg and Eli Global were calculated.

It all began in 2017, the Supreme Court explained in its Dec. 1 opinion, when Eli Global offered to purchase Hemophilia Preferred Care, or HPC, a growing medical business with offices in Mobile and Montgomery, Alabama, and operations in Tennessee, Oklahoma, West Virginia and other states.

The price was $12.2 million, to be paid in annual installments of $2.4 million.

Lindberg, who would later be charged with attempting to bribe North Carolina’s insurance commissioner in 2018 in connection with some of Lindberg’s other investments and businesses, personally guaranteed the promissory note. As part of the deal, Eli Global created a new company, HPCSP Investments, and named Hemophilia Preffered Care’s CEO, Ronald Cieutat, as head of the new firm.

Trouble soon began. The initial installment was late and Eli Global failed to make its second payment, prompting a default notice from Cieutat and, later, a lawsuit by the sellers of the hemophilia firm. Eli Global terminated Cieutat in late 2019.

At the trial court, in the appeal and in a counterclaim, Lindberg’s legal team argued that the purchase agreement and promissory note were unenforceable because Cieutat had failed to disclose that he had allegedly engaged in discrimination against women employees at HPC.

Cieutat in 2020 filed a motion to dismiss Lindberg’s counterclaim, arguing that the discrimination charges were little more than a smoke screen.

“Shortly before the first installment payment was due [on the Promissory Note], Mr. Lindberg was indicted based on evidence that he attempted to bribe the North Carolina Insurance Commissioner,” Cieutat’s motion reads. “Strapped for cash, Eli Global terminated Mr. Cieutat under the guise that he had been engaging in unidentified discriminatory conduct.”

In other words, Lindberg needed the cash for his legal defense, the plaintiffs argued.

A federal jury later that year found Lindberg guilty of trying to bribe Insurance Commissioner Mike Causey in return for relaxed regulation of Lindberg’s life insurance companies, a relaxation that could have allowed the entrepreneur to divert more surplus to his other business ventures. That conviction was overturned in 2022. A new trial is set to begin early next year.

The trial judge agreed with Cieutat and the sellers of HPC, ordering Eli Global and Lindberg to pay the $11 million left on the note, along with the attorney fees. Lindberg’s team appealed the summary judgment, arguing in part that the HPC sellers did not actually possess the paperwork on the note.

The Supreme Court did not buy into that.

“The Promissory Note was not a negotiable instrument,” Justice Brady Mendheim Jr. wrote for the court. “Even if we construed it as such under the New York UCC, the Sellers were not required to prove who possessed the Promissory Note because Eli Global and Lindberg waived that argument in the circuit court.”

Even if Eli Global and Lindberg had not waived their possession argument, the HPC sellers presented a sufficient case to establish that Cieutat, as the sellers’ representative, possessed the note. Eli Global and Lindberg presented no evidence to refute his possession, the justices noted. That underscores the plaintiffs’ right to enforce payment on the note.

Two of the former owners of the hemophilia company have died, but their estates now stand to collect. It’s unclear when Lindberg and his company, facing other lawsuits and fraud charges, may be able to satisfy the judgment. The lower court has 42 days to explain its attorney fee calculations.