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No. 13 30,749-P
SIGMA CONSULTING, LLC
STEPHANIE RIEDEL,
ADMINISTRATOR OF THE ESTATE § IN COUNTY COURT AT LAW
OF KELLY RIEDEL
Plaintiff
UNIVERSITY GENERAL HEALTH NO.TWO
SYSTEM, INC., UGHS SURIGCARE-
WOODLANDS, LLC, UGHS
ANCILLARY SERVICES, INC., AND
UGHS DALLAS HOSPITALS, INC.
Defendant MONTGOMERY COUNTY, TEXAS
ORIGINAL PETITIONAND REQUEST FOR DISCLOSURES
COME NOW Plaintiffs Sigma Consulting, LLC Sigma and Stephanie
Riedel, as the
independent administrator of the estate of Kelly Riedel and files this, their Original Petition
complaining of Defendants University General Health System, Inc. (UGHS) UGHS SurgiCare
Woodlands, LLC (“UGHS - Woodlands”), UGHS Ancillary Services, Inc. (“UGHS Ancillary”),
UGHS Dallas Hospitals, nc. (“UGHS Dallas”) (hereinafter collectivedy “Defendants”) and in
support thereof, would show the Court as follows:
I. Discovery
Plaintiffs intend to conduct discovery under Level 2 of the Texas Rules of Civil
Procedure. Plaintiffs
file this suit seeking monefary relief and monetary relief over $200,000
but not more than $1,000,000.
II. Parties
Plaintiff Sigma Consulting, LLC is a Texas limited liability company
and may be
served through undersigned. counsel of record.
Plaintiff Stephanie Riedel is the independent administrator of her late husband Kelly
Riedel’s estate and may be served through undersigned counsel of record.
Defendant University General Health System, Inc. (UGHS) a Nevada corporation
registeredto conduct business in Texas, may be served with process through its registered agent for
service of process, Capital Corporate Services, Inc., 800 Brazos, Suite 400, Austin, Texas 78701.
Defendant UGHS SurgiCare Woodlands, LLC, a Texas limited liability company,
may be served with process through its registered agent for service of process, Edward T.
Lamborde, Jr, 7501 Fannin Street, Houston, Texas 77054.
Defendant UGHS Ancillary Services, Inc., a Texas corporation, may be served with
process through its registered agent for service of process, Edward T. Lamborde, Jr., 7501 Fannin
Street, Houston, Texas 77054.
Defendant UGHS Dallas Hospitals, nc., a Texas corporation, may be served with
process through its registered agent for service of process, Edward T. Lamborde, Jr., 7501 Fannin
Street, Houston, Texas 77054.
IIL. Jurisdiction and Venue
The ourt hasjurisdiction
over the lawsuit pursuant toTexas Estates Code § 31.002
The ourt has jurisdiction over Defendants as Texas entities or entities registered to conduct
business within Texas. Venue is proper in Montgomery County under Section 15.002(a) of the
Texas Civil Practice
and Remedies Codebecause
all or a substantial part of the events giving rise to
these claims occurred in Montgomery County and because of the pending estate administration in
Montgomery County.
IV. Facts
Sigma Consulting, LLC is a Texas company formed by Stephanie Riedel and her
late husband Kelly Riedel. Sigma principally served as an independent contractor service provider
to the Defendants, with Mr. Riedel performing
the personal services. He consulted
on the growth
and operations of the UGHS family of hospital and health
care facilities across Texas. He created
Sigma to provide information technology services. In 2013 and 2012, respectively, Defendants
incurred $333,939 and $403,908 in charges which were paid as fair and reasonable compensation
for the services rendered.
As was his custom and by agreement
with UGHS, Mr. Riedel charged
large amounts
of UGHS supplies and services on Sigma credit cards which UGHS then reimbursed. This
arrangement continued for about three years without dispute or exception. In October 2013, Mr.
Riedel, only 39 years
old, died unexpectedly thus halting Sigma’s services to UGHS. At the timeof
his death, the Sigma credit card carried a balance of $504,552.29 - all charges atiributable to
efendants
Mr. Rieded was more than a consultantto UGHS, he owned 13 million shares in the
blicly traded company and served, at the time of his death , as the Executive
Vice President of
Operations. From 2008 to 2011, he served as the chief executive officer. Mr. Riedel’s service to
Defendant
was integral to its success. Despite his contributions
to the company, Defendants have,
since
his death, failed and refused to cooperation with Stephanie Riedel as the administrator
of the
estate either in the payment of this debt or in the management of his stock in UGHS.
Sigma maintained two American Express accounts ending in 3 14008
and 5 34009.
At the time of the death of Mr. Riedel, the combined outstanding balance on those accounts was
$504,552.29. A true and conect copy of the October 2013 account statements are attached as
Exhibit “A” and incorporated
herein by reference. The amounts were submitted for payment to
Defendant, who did not dispute the amounts, but rather acknowledged
the amounts due. Ms. Riedel
has now made repeated requests for payments which have been ignored. Attachedas Exhibit “B” is
a true and conect
of Ms. Riedel’s chain of emails to Mike Griffin, chief financial officer
of UGHS,
Hassan Chahadah, chief executive officer of UGHS, and Ed Laborde, General Counsel of UGHS.
Tn response
Mr. Chahadah indicated he would check on the status. Ex. B. Mr. Griffin affirmed that
the amounts would be paid by December 31, 201 . Ex. B. Thereafter, in January 2014, Ms. Riedel
began receiving letters from collections agencies regarding the debt. Ex. . The amount remains
outstanding
in total. The estate of Mr. Riedel is jointly liable for that debt. Attached hereto as
Exhibit “C” is a true and conect copy of the letter from the Collection Agency dated January 13,
regarding payment.
Causes of Action
Breach of Contract by UGHS
Sigmaand
its principal Mr. Riedel entered into a valid oral contract with Defendant s
for the reimbursement of expenses associated with consulting for the company. Plaintiffs fully
performed under the contract by providing the consulting services and paying for services and
purchased supplies to UGHS and its affiliated entities. Defendants
failed and refused to performby
not reimbursing expenses. As a direct and foreseeable
result, Plaintiffs have suffered damages in the
mount of $504,552.29 together with all outstanding services charges and interest. Plaintiffs have
also suffered damages to credit and goodwill.
Quantum Meruit by UGHS
Altematively, Plaintiffs provided valuable services or materials to Defendants in the
form of credit extended by Plaintiffs. These services nd/or materials were provided for the benefit
of Defendants and accepted by DefendantsDefendants both through the course of conduct
between the parties and the actual agreement had reasonable notice that Plaintiffs expected
compensation for the services or materials provided. Defendants did in fact acknowledge the debt
and their responsibility
for the same. As a direct and foreseeable
result, Plaintiffs have suffered
damages in the amount of $504,552.29, together
with all outstanding
services charges and interest.
Plaintiffs
have also suffered damages to credit and goodwill.
Promissory Estoppel
Defendants collectively promised to Plaintiffs regarding the reimbursement of
expenses. Plaintiffs reasonably and substantially relied on the promise to its detriment. Plaintiffs’
reliance was foreseeable by the Defendants. Injustice can be avoided only by enforcing the
Defendants’ promise to reimburse expenses. As a direct and foreseeable result, Plaintiffs have
suffered damages
in the amount of $504,552.29 together
with all outstanding services charges and
interest. Plaintiffs
have also suffered damages to credit
and goodwill.
VIII. Request for Disclosures
Under Texas Rule of Civil Procedure 194, Plaintiffs request that each Defendant
disclose, within 50 days of the services of this request, the information
or material described
in Rule
IX. Attorney’s Fees
Plaintiffs seek to recover reasonable and necessary attomey’s fees pursuant to
Chapters of the Texas Civil Practice and Remedies Code
X. Conditions Precedent
All conditions precedent to Plaintiffs’ claims for relief have been performed or have
occurred.
XI PRAYER
WHEREFORE, PREMISES CONSIDERED, Plaintiffs Sigma Consulting, LLC and
Stephanie Riedel, as the independent administrator of the state of Kelly Riedel ask that the Court
issue citations for Defendants University General Health System, Inc, UGHS SurgiCare
Woodlands, LLC, UGHS Ancillary Services, Inc., UGHS Dallas Hospitals, Inc. to appear and
answer. Plaintiffs further pray that upon final hearing, they be awarded a judgment against
efendants for the following:
Actual damages;
Special and consequential damages;
Prejudgment and post judgment interest;
Court costs;
Attomey fees;
All otherrelief
to which Plaintiffs are entitled
Respectfully submitted,
KNIGHTON & STONE, PLLC
/s/ RachelN.
Jay V. Knighton II
Texas Bar No. 24041266
jay@knightonstone.com
RachelN.
Texas Bar No. 24053322
Rachel @knightonstone.com
2202 Timberloch Place, Suite 250
The Woodlands, Texas 77380
Tel. (281) 681-3004
Fax. (281) 681-3007
Attorneysfor Plaintiffs
DUPLICATE COPY
lum C:
GMA CONSULTING LLC
ELLY RIEDEL
Exhibit A Oz. p15
losing Date 10/11/13 Account Ending 3-14008
—— — a ae —— —— _-
[ Total Early Pay Discount To Date
Your Payment ‘Options this Month: Asof 10/11/13
Je a os 2 $278,362.60
Early Pay
Earn an Early Pay Discount of $9,445.24 on eligible charges this month of |
$472,261.79 when you pay the New Balance in full by 10/21/13 ee
Account Summary _ —
New Balance $472,261.79
Previous Balance $0.00
Please Pay By 10/21/13 | Payments/Credits -$169.58
Includes Early Pay Discount of -$0.00
a a — oo 3
-OR-
sa New Charges +$472,431.37
Defer Pay Fees +$0.00
Pay at least $47,226.17 by 11/05/13 and defer your remaining balance, up to
$425,035.62, until the Please Pay By date on your next statement |
Amount Due $47,226.17 | | New Balance $472,261 79 |
Please Pay By 11/05/13 a
1 Days in Billing Period: 31
— ~ a so
oe _ a as
Customer Care _ — oo
{=}
(@
See page 2 for important information about your account.
Account cancelled.
| Pay by Computer
open.com/pbc
Customer Care Pay by Phone
1-800-653-1693 1-800-472-9297
| {-2) See Page 2 for additional information.
\ Ve
+ Please fold on the perforation below, detach and return with your payment $
-
Cl Payment Coupon Pay by Computer 3 Pay by Phone Account Ending 3-14008
Do not staple or use paper clips open.com/pbe 1-800-472-9297
Enter account number on all documents.
Make check payable to American Express
KELLY RIEDEL. Early Pay Option
SIGMA CONSULTING LLC
11 STERLING DALE PL lew Balance $472,261.79
SPRING TX 77382-2761 Please
eeePay By oe :
10/21/13
Defer Pay Option
| Amount Due $47,226.17
| Please Pay By - 11/05/13
AMERICAN EXPRESS
Check here if your addressor P.O. BOX 650448
phone number has changed. DALLAS TX 75265-0448
Note changes on reverse side. thal wubb Ihdhs Hatatull all
00003499915415686043 O4?2ebL?IOO4?eebL? OF d
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DUPLICATE COPY
KELLY RIEDEL _ - _Account Ending 3-14008 p. 2/5
Payments: Your payment must be sent to the payment address shown on your statement and must be received by 5 p.m. local time at that address to
be credited as of the day itis received, Payments we receive after 5 p.m. will not be credited to your Account until the next day. Payments must also:
(1) include the remittance coupon from your statement; (2) be made with a single check drawn on a US bank and payable in US dollars, or with a
negotiable instrument payable in US dollars and clearable through the US banking system; and (3) include your Account number. If your payment does
Not Meet all Of the above requirements, crediting may be delayed and you may incur late payment fees and additional interest charges. Electronic
payments must be made through an electronic payment method payable in US dollars and clearable through the US banking system. If we accept
payment in a foreign currency, we will convert it into US dollarsat a Conversion rate that is acceptable to us, unless a particulat rate is 1equired by law.
Please do not send post-dated checks as they will be deposited upon receipt. Any restrictive language on a payment we accept will have no effect on
us without our express prior written approval. We will 1e-present to your financial institution any payment that is returned unpaid.
Permission for Electronic Withdrawal: (1) When you send a check for payment, you give us permission to electronically withdraw your payment from
your deposit or other asset account. We will process checks electronically by transmitting the amount of the check, routing number, account number
and check serial number to your financial institution, unless the check is not processable electronically or a less costly process is available. When we
process your check electronically, your payment may be withdrawn from your deposit or other asset account as soon as the same day we receive yout
check, and you will not receive that cancelled check with your financial account statement. If we cannot collect the funds electronically we may issue a
draft against your deposit or other asset account for the amount of the check. (2) By using Pay By Computer, Pay By Phone or any other electronic
payment service of ours, you give us permission to electronically withdraw funds from the deposit or other asset account you specify in the amount you
request. Payments using such services of ours received after 8:00 p.m. MST may not be credited until the next day.
Foreign Currency Charges: If you make a Charge ina foreign currency, we will convert it into US dollars on the date we or our agents process it
We will charge a fee of 2.7% of the converted US dollar amount. We will choose a conversion rate that is acceptable to us for that date, unless a
particular rate is required by law. The conversion rate we use is no more than the highest official rate published by a government agency or the highest
interbank tate we identify from customary banking sources on the conversion date or the prior business day. This rate may differ from rates ine ect on
the date of your charge. Charges converted by establishments will be billed at the rates such establishments use
Credit Balance: A credit balance (designated CR) shown on this statement represents money owed to you. If within the six-month period following the
date of the first statement indicating the credit balance you do not request a refund or charge enough to use up th credit balance, we will send you a
check for the credit balance within 30 days if the amount is $1.00 or more.
Credit Reporting: We may report information about your Account to credit bureaus. Late payments, missed payments, or other defaultson your
Account may be reflected in your credit report,
Hearing Impaired || Website: americanexpress.com
G Customer Care & Billing inquiries
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Express Cash 1-800-CASH-NOW & Billing Inquiries Payments
P.O. BOX 981535 P.O. BOX 650448,
EL PASO, TX DALLAS TX.
79998-1535 75205-0448
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Plum
IGMA CONSULTING
ELLY RIEDEL
LLC Oa. p. 35
losing Date 10/11/13 Account Ending 3-14008
f
| Payments and Credits
| Summary
Total
Payments $0.00
Credits $169.58
Total Payments and Credits ~$169.58
>
{ Detail “Indicates posting date
Credits Amount
sorone CR ADJ - ANNUAL MEMBERSHIP FEE ~$169.58
~
| New Charges
| Summary
Total
Total New Charges _ $472,431.37
— }
{ Detail J
KELLY RIEDEL
Card Ending 3-14008
Amount
09/14/13 ATHAS ADMINISTRATIVE214-261-5811 $200,850.00
UGH 75231
MEDICAL SERVICES
oonen3 PHILIPS MEDICAL NORTBOTHELL WA $70,348.26.
4254828746
ae
09/1 8/13 UNIVERSITY GENERAL HHOUSTON, ™ $101,232.11
713-3757100
a
09/19/13 WINSTEAD PC DALLAS 1X $100,000.00
2147455400
-
0929/1 3 CREDITSECURE COSTAMESA CA $1.00
1-866-617-1893
Description
CREDITOR?
Fees
Amount
Total Fees for this Period $0.00
2013 Fees and Interest Totals Year-to-Date
Amount
Total Fees in 2013 $15.42
Total Interest in 2013 $0.00
Continued on reverse
DUPLICATE COPY
KELLY RIEDEL Account Ending 3-14008 p. 4/5
Plum Options Summary As of 10/11/13, }
Early Pay Discount History:
Total Year-To-Date $ 0.00
Total-to-Date $ 278,362.60
Note: Early Pay Discount Summary does not include Adjustments
DUPLICATE COPY
elta Reserve for Business Credit Card ADELTA p15
SIGMA CONSULTING LLC
AKELLY RIEDEL
“Closing Date 10/25/13 Account Ending 5-34009
a
oe
To view your Delta SkyMiles®
|| New Balance "$32,120.92 | balance, visit delta.com
| Minimum Payment Due $321.00 ||
|
| | Payment Due Date 11/19/13 | Account Summary
Previous Balance $32,620.92
Payments/Credits -$500.00
New Charges +$0.00 |
|
Fees +$0.00 ||
Interest Charged +$0.00
ee
New Balance : $32,120.92 i
[2) See page 2 for important information about your account. Minimum Payment Due $321.00 i
Credit Limit $40,800.00
@ Your accountis cancelled. Available Credit $8,679.08
x
Cash Advance Limit $0.00
Available Cash $0.00
Days in Billing Period: 31
Customer Care
=
Pay by Computer
open.com/pbe
L
||
Customer Care Payby Phone
| 1-800-297-6200 1-800-472-9297
th See page 2 for additional information
+ Please fold on the perforation below, detach and return with your payment $
Payment Coupon Pay by Computer ip Pay by Phone Account Ending 5-34009
Do not staple or use paper clips open.com/pbe 1-800-472-9297 Enter account numberon all documents.
Make check payable to American Express
KELLY RIEDEL
SIGMA CONSULTING LLC Payment Due Date
11 STERLING DALE PL 11/19/13
SPRING TX 77382-2761
New Balance
$32,120.92
Minimum Payment Due
$321.00
AMERICAN EXPRESS
P.O. BOX 650448 .
Check here if your address or Amount Enclosed
phone number has changed DALLAS TX 75265-0448
Note changes on reverse side.
Walbbaldllahbll slballdatallabdoall
000034999095472894? 0032120920000321L00 21 d
DUPLICATE COPY
_ KELLY RIEDEL Account Ending 5-34009 p. 2/5
Payments: Your payment must be sent t to the payment address shown on your statement and must be received by 5 p.m. local time at that address to
be credited as of the day it is received. Payments we receive after 5 p.m. will not be credited to your Account until the next day. Payments must also:
(1) include the remittance coupon from your stai tement; (2) be made with a single check drawn ona US bank and payable in US dollars, or with a
negotiable instrument payable in US dollars and Clearable through the US banking system; and (3) include your Account number. IFyourElectronic payment does
not meet all of the above requirements, crediting may be delayed and you may incur late payment fees and additional interest charges.
payments must be made throu: igh an electronic payment method payable in US dollars and clearable through the US banking system. if we accept
payment in a foreign currency, we will convert it into US dollars at a Conversion rate that is acceptable to us, unless a particular rate is required by law.
will have no effect on
Please do not send post-dated c hecks as they will be deposited upon receipt. Any restrictive language on a payment we accept unpaid.
us without our express prior written approval. We will re-present to your financial institution any payment that is returned
Permission for Electronic Withdrawal: (1) When you send a check for payment, you give us permission to electronically withdraw your payment from,
your deposit or othe: asset account. We will process checks electronically by transmitting the amount of the check, routing number, account number
and check serial num ber to your financial institution, unless the check is not processable electronically or a less costly process is available. When we
process your check electronically, your payment may be withdrawn fram your deposit or other asset account as soon as the same day we receive your
check, and you will not receiveth iat cancelled check with your financial account statement. If we cannot collect the funds electronically we may issue a
draft against your deposit or other asset account for the amount of the check. (2) By using Pay By Computer, Pay By Phoneor any other electronic
payment service of ours, you give us permission to el lectronically withdraw funds from the deposit or other asset account you specify in the amount you
Tequest. Payments using such services of ours received after 8:00 p.m. MST may not be credited until the next day.
How We Calculate Your Balance: We use the Average Daily Balance (ADB) method (including new transactions) to calculate the balance on which we
charge interest on your Account. Call the Customer Service number listed below for more information about this balance computation method and
how resulting interest charges are determined. The method we use to calculate the ADB and interest results in daily compounding of interest.
Paying Interes t: Your due date is at least 25 days after the Closing Date of each billing period. We will not charge you interest on your purchases if you
pay the New Bal lance by the due date each month. We will charge you interest on cash advances and (unless otherwise disclosed) balance transfers
beginning on the transaction date.
Foreign Currency Charges: If you make a Charge ina foreign curr ency, we will convert it into US dollars on the date we or our agents process it.
We ll charge a fee of 2.7% of the converted US dollar amoun' 1. We will choose a conversion rate that is acceptable to us for that date, unless a
particular rate is required by law. The conversion rate we use is no more than the highest official rate published by a government agency or the highest
interbank rate we identify from customary banking sources on the conversion date or the prior business day. This rate may differ from rates in effect on
the date of your charge. Charges converted by establishments (such as airlines) will be billed at the rates such establishments use.
Credit Balance: A credit balance (designated CR) shown on this statement represents money owed to you. if within the si month period following the
date of the first statement indicating the credit balance you do not request a refund or charge enough to use up the credit balance, we will send youa
check for the credit balance within 30 days ifthe amount is $1.00 or more.
Credit Reporting: We may report information about your Account to credit bureaus. Late payments, missed payments, or other defaults on your
Account may be reflected in your credit report.
- a cy
Website: americanexpress.com
Customer Care & Billing Inquiries
International Collect
1-800-297-6200
1-623-492-7719
eae tmspaired
TTY: -800-221-9950
|
a Mobile Site: amexmobile.com
Large Print & Braille Statements 1-800-297-6200 FAX: 1-800-695-9090
Express Cash 1-800-CASH-NOW In NY: 1-800-522-1897 Customer Care
& Billing Inquiries Payments
P.O, BOX 981535 P.O. BOX 650448
EL PASO, TX DALLAS TX
79998-1535 75265-0448
-
Change of Address
ifcorrect on front, do not use. | Pay Your Bill with AutoPay
* Tochange your address online, visit www.americanexpress.com/updatecontactinfo i * Avoid late fees
* For Name, Company Name, and Foreign Address or Phone changes, please call Customer Care. + Save time
* Please print clearly in blue or black ink only in the boxes provided.
Deduct your payment from your bank
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Street Address
Visit americanexpress.com/autopay
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Zip Code
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ocmaccemend www.americanexpress.com/privacy.
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Delta Reserve for Business Credit Card
“SIGMA CONSULTING LL ADELTA p. 3/5
KELLY RIEDEL
= losing Date 10/25/13 Account Ending 5-34009
f
| Payments and Credits
| Summary
Total
Payments -$500.00
Credits $0.00
Total Payments and Credits -$500.00 _
[ Detail “Indicates posting date
Payments Amount
09/28/13* ONLINE PAYMEN T- THANK YOU ~$500.00
a
Fees
Amount
Total Fees for this Period $0.00
Interest Charged
Amount
Total Interest Charged for this Period $0.00
2013 Fees and Interest Totals Year-to-Date
Preview
No. 13 30,749-P SIGMA CONSULTING, LLC STEPHANIE RIEDEL, ADMINISTRATOR OF THE ESTATE § IN COUNTY COURT AT LAW OF KELLY RIEDEL Plaintiff UNIVERSITY GENERAL HEALTH NO.TWO SYSTEM, INC., UGHS SURIGCARE- WOODLANDS, LLC, UGHS ANCILLARY SERVICES, INC., AND UGHS DALLAS HOSPITALS, INC. Defendant MONTGOMERY COUNTY, TEXAS ORIGINAL PETITIONAND REQUEST FOR DISCLOSURES COME NOW Plaintiffs Sigma Consulting, LLC Sigma and Stephanie Riedel, as the independent administrator of the estate of Kelly Riedel and files this, their Original Petition complaining of Defendants University General Health System, Inc. (UGHS) UGHS SurgiCare Woodlands, LLC (“UGHS - Woodlands”), UGHS Ancillary Services, Inc. (“UGHS Ancillary”), UGHS Dallas Hospitals, nc. (“UGHS Dallas”) (hereinafter collectivedy “Defendants”) and in support thereof, would show the Court as follows: I. Discovery Plaintiffs intend to conduct discovery under Level 2 of the Texas Rules of Civil Procedure. Plaintiffs file this suit seeking monefary relief and monetary relief over $200,000 but not more than $1,000,000. II. Parties Plaintiff Sigma Consulting, LLC is a Texas limited liability company and may be served through undersigned. counsel of record. Plaintiff Stephanie Riedel is the independent administrator of her late husband Kelly Riedel’s estate and may be served through undersigned counsel of record. Defendant University General Health System, Inc. (UGHS) a Nevada corporation registeredto conduct business in Texas, may be served with process through its registered agent for service of process, Capital Corporate Services, Inc., 800 Brazos, Suite 400, Austin, Texas 78701. Defendant UGHS SurgiCare Woodlands, LLC, a Texas limited liability company, may be served with process through its registered agent for service of process, Edward T. Lamborde, Jr, 7501 Fannin Street, Houston, Texas 77054. Defendant UGHS Ancillary Services, Inc., a Texas corporation, may be served with process through its registered agent for service of process, Edward T. Lamborde, Jr., 7501 Fannin Street, Houston, Texas 77054. Defendant UGHS Dallas Hospitals, nc., a Texas corporation, may be served with process through its registered agent for service of process, Edward T. Lamborde, Jr., 7501 Fannin Street, Houston, Texas 77054. IIL. Jurisdiction and Venue The ourt hasjurisdiction over the lawsuit pursuant toTexas Estates Code § 31.002 The ourt has jurisdiction over Defendants as Texas entities or entities registered to conduct business within Texas. Venue is proper in Montgomery County under Section 15.002(a) of the Texas Civil Practice and Remedies Codebecause all or a substantial part of the events giving rise to these claims occurred in Montgomery County and because of the pending estate administration in Montgomery County. IV. Facts Sigma Consulting, LLC is a Texas company formed by Stephanie Riedel and her late husband Kelly Riedel. Sigma principally served as an independent contractor service provider to the Defendants, with Mr. Riedel performing the personal services. He consulted on the growth and operations of the UGHS family of hospital and health care facilities across Texas. He created Sigma to provide information technology services. In 2013 and 2012, respectively, Defendants incurred $333,939 and $403,908 in charges which were paid as fair and reasonable compensation for the services rendered. As was his custom and by agreement with UGHS, Mr. Riedel charged large amounts of UGHS supplies and services on Sigma credit cards which UGHS then reimbursed. This arrangement continued for about three years without dispute or exception. In October 2013, Mr. Riedel, only 39 years old, died unexpectedly thus halting Sigma’s services to UGHS. At the timeof his death, the Sigma credit card carried a balance of $504,552.29 - all charges atiributable to efendants Mr. Rieded was more than a consultantto UGHS, he owned 13 million shares in the blicly traded company and served, at the time of his death , as the Executive Vice President of Operations. From 2008 to 2011, he served as the chief executive officer. Mr. Riedel’s service to Defendant was integral to its success. Despite his contributions to the company, Defendants have, since his death, failed and refused to cooperation with Stephanie Riedel as the administrator of the estate either in the payment of this debt or in the management of his stock in UGHS. Sigma maintained two American Express accounts ending in 3 14008 and 5 34009. At the time of the death of Mr. Riedel, the combined outstanding balance on those accounts was $504,552.29. A true and conect copy of the October 2013 account statements are attached as Exhibit “A” and incorporated herein by reference. The amounts were submitted for payment to Defendant, who did not dispute the amounts, but rather acknowledged the amounts due. Ms. Riedel has now made repeated requests for payments which have been ignored. Attachedas Exhibit “B” is a true and conect of Ms. Riedel’s chain of emails to Mike Griffin, chief financial officer of UGHS, Hassan Chahadah, chief executive officer of UGHS, and Ed Laborde, General Counsel of UGHS. Tn response Mr. Chahadah indicated he would check on the status. Ex. B. Mr. Griffin affirmed that the amounts would be paid by December 31, 201 . Ex. B. Thereafter, in January 2014, Ms. Riedel began receiving letters from collections agencies regarding the debt. Ex. . The amount remains outstanding in total. The estate of Mr. Riedel is jointly liable for that debt. Attached hereto as Exhibit “C” is a true and conect copy of the letter from the Collection Agency dated January 13, regarding payment. Causes of Action Breach of Contract by UGHS Sigmaand its principal Mr. Riedel entered into a valid oral contract with Defendant s for the reimbursement of expenses associated with consulting for the company. Plaintiffs fully performed under the contract by providing the consulting services and paying for services and purchased supplies to UGHS and its affiliated entities. Defendants failed and refused to performby not reimbursing expenses. As a direct and foreseeable result, Plaintiffs have suffered damages in the mount of $504,552.29 together with all outstanding services charges and interest. Plaintiffs have also suffered damages to credit and goodwill. Quantum Meruit by UGHS Altematively, Plaintiffs provided valuable services or materials to Defendants in the form of credit extended by Plaintiffs. These services nd/or materials were provided for the benefit of Defendants and accepted by DefendantsDefendants both through the course of conduct between the parties and the actual agreement had reasonable notice that Plaintiffs expected compensation for the services or materials provided. Defendants did in fact acknowledge the debt and their responsibility for the same. As a direct and foreseeable result, Plaintiffs have suffered damages in the amount of $504,552.29, together with all outstanding services charges and interest. Plaintiffs have also suffered damages to credit and goodwill. Promissory Estoppel Defendants collectively promised to Plaintiffs regarding the reimbursement of expenses. Plaintiffs reasonably and substantially relied on the promise to its detriment. Plaintiffs’ reliance was foreseeable by the Defendants. Injustice can be avoided only by enforcing the Defendants’ promise to reimburse expenses. As a direct and foreseeable result, Plaintiffs have suffered damages in the amount of $504,552.29 together with all outstanding services charges and interest. Plaintiffs have also suffered damages to credit and goodwill. VIII. Request for Disclosures Under Texas Rule of Civil Procedure 194, Plaintiffs request that each Defendant disclose, within 50 days of the services of this request, the information or material described in Rule IX. Attorney’s Fees Plaintiffs seek to recover reasonable and necessary attomey’s fees pursuant to Chapters of the Texas Civil Practice and Remedies Code X. Conditions Precedent All conditions precedent to Plaintiffs’ claims for relief have been performed or have occurred. XI PRAYER WHEREFORE, PREMISES CONSIDERED, Plaintiffs Sigma Consulting, LLC and Stephanie Riedel, as the independent administrator of the state of Kelly Riedel ask that the Court issue citations for Defendants University General Health System, Inc, UGHS SurgiCare Woodlands, LLC, UGHS Ancillary Services, Inc., UGHS Dallas Hospitals, Inc. to appear and answer. Plaintiffs further pray that upon final hearing, they be awarded a judgment against efendants for the following: Actual damages; Special and consequential damages; Prejudgment and post judgment interest; Court costs; Attomey fees; All otherrelief to which Plaintiffs are entitled Respectfully submitted, KNIGHTON & STONE, PLLC /s/ RachelN. Jay V. Knighton II Texas Bar No. 24041266 jay@knightonstone.com RachelN. Texas Bar No. 24053322 Rachel @knightonstone.com 2202 Timberloch Place, Suite 250 The Woodlands, Texas 77380 Tel. (281) 681-3004 Fax. (281) 681-3007 Attorneysfor Plaintiffs DUPLICATE COPY lum C: GMA CONSULTING LLC ELLY RIEDEL Exhibit A Oz. p15 losing Date 10/11/13 Account Ending 3-14008 —— — a ae —— —— _- [ Total Early Pay Discount To Date Your Payment ‘Options this Month: Asof 10/11/13 Je a os 2 $278,362.60 Early Pay Earn an Early Pay Discount of $9,445.24 on eligible charges this month of | $472,261.79 when you pay the New Balance in full by 10/21/13 ee Account Summary _ — New Balance $472,261.79 Previous Balance $0.00 Please Pay By 10/21/13 | Payments/Credits -$169.58 Includes Early Pay Discount of -$0.00 a a — oo 3 -OR- sa New Charges +$472,431.37 Defer Pay Fees +$0.00 Pay at least $47,226.17 by 11/05/13 and defer your remaining balance, up to $425,035.62, until the Please Pay By date on your next statement | Amount Due $47,226.17 | | New Balance $472,261 79 | Please Pay By 11/05/13 a 1 Days in Billing Period: 31 — ~ a so oe _ a as Customer Care _ — oo {=} (@ See page 2 for important information about your account. Account cancelled. | Pay by Computer open.com/pbc Customer Care Pay by Phone 1-800-653-1693 1-800-472-9297 | {-2) See Page 2 for additional information. \ Ve + Please fold on the perforation below, detach and return with your payment $ - Cl Payment Coupon Pay by Computer 3 Pay by Phone Account Ending 3-14008 Do not staple or use paper clips open.com/pbe 1-800-472-9297 Enter account number on all documents. Make check payable to American Express KELLY RIEDEL. Early Pay Option SIGMA CONSULTING LLC 11 STERLING DALE PL lew Balance $472,261.79 SPRING TX 77382-2761 Please eeePay By oe : 10/21/13 Defer Pay Option | Amount Due $47,226.17 | Please Pay By - 11/05/13 AMERICAN EXPRESS Check here if your addressor P.O. BOX 650448 phone number has changed. DALLAS TX 75265-0448 Note changes on reverse side. thal wubb Ihdhs Hatatull all 00003499915415686043 O4?2ebL?IOO4?eebL? OF d L DUPLICATE COPY KELLY RIEDEL _ - _Account Ending 3-14008 p. 2/5 Payments: Your payment must be sent to the payment address shown on your statement and must be received by 5 p.m. local time at that address to be credited as of the day itis received, Payments we receive after 5 p.m. will not be credited to your Account until the next day. Payments must also: (1) include the remittance coupon from your statement; (2) be made with a single check drawn on a US bank and payable in US dollars, or with a negotiable instrument payable in US dollars and clearable through the US banking system; and (3) include your Account number. If your payment does Not Meet all Of the above requirements, crediting may be delayed and you may incur late payment fees and additional interest charges. Electronic payments must be made through an electronic payment method payable in US dollars and clearable through the US banking system. If we accept payment in a foreign currency, we will convert it into US dollarsat a Conversion rate that is acceptable to us, unless a particulat rate is 1equired by law. Please do not send post-dated checks as they will be deposited upon receipt. Any restrictive language on a payment we accept will have no effect on us without our express prior written approval. We will 1e-present to your financial institution any payment that is returned unpaid. Permission for Electronic Withdrawal: (1) When you send a check for payment, you give us permission to electronically withdraw your payment from your deposit or other asset account. We will process checks electronically by transmitting the amount of the check, routing number, account number and check serial number to your financial institution, unless the check is not processable electronically or a less costly process is available. When we process your check electronically, your payment may be withdrawn from your deposit or other asset account as soon as the same day we receive yout check, and you will not receive that cancelled check with your financial account statement. If we cannot collect the funds electronically we may issue a draft against your deposit or other asset account for the amount of the check. (2) By using Pay By Computer, Pay By Phone or any other electronic payment service of ours, you give us permission to electronically withdraw funds from the deposit or other asset account you specify in the amount you request. Payments using such services of ours received after 8:00 p.m. MST may not be credited until the next day. Foreign Currency Charges: If you make a Charge ina foreign currency, we will convert it into US dollars on the date we or our agents process it We will charge a fee of 2.7% of the converted US dollar amount. We will choose a conversion rate that is acceptable to us for that date, unless a particular rate is required by law. The conversion rate we use is no more than the highest official rate published by a government agency or the highest interbank tate we identify from customary banking sources on the conversion date or the prior business day. This rate may differ from rates ine ect on the date of your charge. Charges converted by establishments will be billed at the rates such establishments use Credit Balance: A credit balance (designated CR) shown on this statement represents money owed to you. If within the six-month period following the date of the first statement indicating the credit balance you do not request a refund or charge enough to use up th credit balance, we will send you a check for the credit balance within 30 days if the amount is $1.00 or more. Credit Reporting: We may report information about your Account to credit bureaus. Late payments, missed payments, or other defaultson your Account may be reflected in your credit report, Hearing Impaired || Website: americanexpress.com G Customer Care & Billing inquiries International Collect Large Print & Braille Statements 1-800-653-1693 1-623-492-3344 1-800-653-1693 TTY: 1-800-221-9950 FAX: 1-800-695-9090 Mobile Site: amexmobile.com Lost or Stolen Card 800-653-1693 in NY: 1-800-522-1897 || Customer Care Express Cash 1-800-CASH-NOW & Billing Inquiries Payments P.O. BOX 981535 P.O. BOX 650448, EL PASO, TX DALLAS TX. 79998-1535 75205-0448 Change of Address Hfconect on tront, do not use. | Pay Your Bill with AutoPay * To change your address online, visit wanw.amesicanexpress.conv/updatecontactinfo + For Name, Company Name, and Foreign Address or Phone changes, please call Custorner Care. | + Avoid late fees * Please print clearly in blue or black ink only in the boxes provided, | + Save time so | Deduct your payment from your bank Street Address | account automatically each month | i | Visit americanexpress.com/autopay City, State i todayto enroll. | Zip Code ‘Area Code and Home Phone Atea Code and For information on how we protect your Work Phone: privacy and to set your comenunication Email and privacy choices, please visit www.americanexpress.com/privacy. DUPLICATE COPY Plum IGMA CONSULTING ELLY RIEDEL LLC Oa. p. 35 losing Date 10/11/13 Account Ending 3-14008 f | Payments and Credits | Summary Total Payments $0.00 Credits $169.58 Total Payments and Credits ~$169.58 > { Detail “Indicates posting date Credits Amount sorone CR ADJ - ANNUAL MEMBERSHIP FEE ~$169.58 ~ | New Charges | Summary Total Total New Charges _ $472,431.37 — } { Detail J KELLY RIEDEL Card Ending 3-14008 Amount 09/14/13 ATHAS ADMINISTRATIVE214-261-5811 $200,850.00 UGH 75231 MEDICAL SERVICES oonen3 PHILIPS MEDICAL NORTBOTHELL WA $70,348.26. 4254828746 ae 09/1 8/13 UNIVERSITY GENERAL HHOUSTON, ™ $101,232.11 713-3757100 a 09/19/13 WINSTEAD PC DALLAS 1X $100,000.00 2147455400 - 0929/1 3 CREDITSECURE COSTAMESA CA $1.00 1-866-617-1893 Description CREDITOR? Fees Amount Total Fees for this Period $0.00 2013 Fees and Interest Totals Year-to-Date Amount Total Fees in 2013 $15.42 Total Interest in 2013 $0.00 Continued on reverse DUPLICATE COPY KELLY RIEDEL Account Ending 3-14008 p. 4/5 Plum Options Summary As of 10/11/13, } Early Pay Discount History: Total Year-To-Date $ 0.00 Total-to-Date $ 278,362.60 Note: Early Pay Discount Summary does not include Adjustments DUPLICATE COPY elta Reserve for Business Credit Card ADELTA p15 SIGMA CONSULTING LLC AKELLY RIEDEL “Closing Date 10/25/13 Account Ending 5-34009 a oe To view your Delta SkyMiles® || New Balance "$32,120.92 | balance, visit delta.com | Minimum Payment Due $321.00 || | | | Payment Due Date 11/19/13 | Account Summary Previous Balance $32,620.92 Payments/Credits -$500.00 New Charges +$0.00 | | Fees +$0.00 || Interest Charged +$0.00 ee New Balance : $32,120.92 i [2) See page 2 for important information about your account. Minimum Payment Due $321.00 i Credit Limit $40,800.00 @ Your accountis cancelled. Available Credit $8,679.08 x Cash Advance Limit $0.00 Available Cash $0.00 Days in Billing Period: 31 Customer Care = Pay by Computer open.com/pbe L || Customer Care Payby Phone | 1-800-297-6200 1-800-472-9297 th See page 2 for additional information + Please fold on the perforation below, detach and return with your payment $ Payment Coupon Pay by Computer ip Pay by Phone Account Ending 5-34009 Do not staple or use paper clips open.com/pbe 1-800-472-9297 Enter account numberon all documents. Make check payable to American Express KELLY RIEDEL SIGMA CONSULTING LLC Payment Due Date 11 STERLING DALE PL 11/19/13 SPRING TX 77382-2761 New Balance $32,120.92 Minimum Payment Due $321.00 AMERICAN EXPRESS P.O. BOX 650448 . Check here if your address or Amount Enclosed phone number has changed DALLAS TX 75265-0448 Note changes on reverse side. Walbbaldllahbll slballdatallabdoall 000034999095472894? 0032120920000321L00 21 d DUPLICATE COPY _ KELLY RIEDEL Account Ending 5-34009 p. 2/5 Payments: Your payment must be sent t to the payment address shown on your statement and must be received by 5 p.m. local time at that address to be credited as of the day it is received. Payments we receive after 5 p.m. will not be credited to your Account until the next day. Payments must also: (1) include the remittance coupon from your stai tement; (2) be made with a single check drawn ona US bank and payable in US dollars, or with a negotiable instrument payable in US dollars and Clearable through the US banking system; and (3) include your Account number. IFyourElectronic payment does not meet all of the above requirements, crediting may be delayed and you may incur late payment fees and additional interest charges. payments must be made throu: igh an electronic payment method payable in US dollars and clearable through the US banking system. if we accept payment in a foreign currency, we will convert it into US dollars at a Conversion rate that is acceptable to us, unless a particular rate is required by law. will have no effect on Please do not send post-dated c hecks as they will be deposited upon receipt. Any restrictive language on a payment we accept unpaid. us without our express prior written approval. We will re-present to your financial institution any payment that is returned Permission for Electronic Withdrawal: (1) When you send a check for payment, you give us permission to electronically withdraw your payment from, your deposit or othe: asset account. We will process checks electronically by transmitting the amount of the check, routing number, account number and check serial num ber to your financial institution, unless the check is not processable electronically or a less costly process is available. When we process your check electronically, your payment may be withdrawn fram your deposit or other asset account as soon as the same day we receive your check, and you will not receiveth iat cancelled check with your financial account statement. If we cannot collect the funds electronically we may issue a draft against your deposit or other asset account for the amount of the check. (2) By using Pay By Computer, Pay By Phoneor any other electronic payment service of ours, you give us permission to el lectronically withdraw funds from the deposit or other asset account you specify in the amount you Tequest. Payments using such services of ours received after 8:00 p.m. MST may not be credited until the next day. How We Calculate Your Balance: We use the Average Daily Balance (ADB) method (including new transactions) to calculate the balance on which we charge interest on your Account. Call the Customer Service number listed below for more information about this balance computation method and how resulting interest charges are determined. The method we use to calculate the ADB and interest results in daily compounding of interest. Paying Interes t: Your due date is at least 25 days after the Closing Date of each billing period. We will not charge you interest on your purchases if you pay the New Bal lance by the due date each month. We will charge you interest on cash advances and (unless otherwise disclosed) balance transfers beginning on the transaction date. Foreign Currency Charges: If you make a Charge ina foreign curr ency, we will convert it into US dollars on the date we or our agents process it. We ll charge a fee of 2.7% of the converted US dollar amoun' 1. We will choose a conversion rate that is acceptable to us for that date, unless a particular rate is required by law. The conversion rate we use is no more than the highest official rate published by a government agency or the highest interbank rate we identify from customary banking sources on the conversion date or the prior business day. This rate may differ from rates in effect on the date of your charge. Charges converted by establishments (such as airlines) will be billed at the rates such establishments use. Credit Balance: A credit balance (designated CR) shown on this statement represents money owed to you. if within the si month period following the date of the first statement indicating the credit balance you do not request a refund or charge enough to use up the credit balance, we will send youa check for the credit balance within 30 days ifthe amount is $1.00 or more. Credit Reporting: We may report information about your Account to credit bureaus. Late payments, missed payments, or other defaults on your Account may be reflected in your credit report. - a cy Website: americanexpress.com Customer Care & Billing Inquiries International Collect 1-800-297-6200 1-623-492-7719 eae tmspaired TTY: -800-221-9950 | a Mobile Site: amexmobile.com Large Print & Braille Statements 1-800-297-6200 FAX: 1-800-695-9090 Express Cash 1-800-CASH-NOW In NY: 1-800-522-1897 Customer Care & Billing Inquiries Payments P.O, BOX 981535 P.O. BOX 650448 EL PASO, TX DALLAS TX 79998-1535 75265-0448 - Change of Address ifcorrect on front, do not use. | Pay Your Bill with AutoPay * Tochange your address online, visit www.americanexpress.com/updatecontactinfo i * Avoid late fees * For Name, Company Name, and Foreign Address or Phone changes, please call Customer Care. + Save time * Please print clearly in blue or black ink only in the boxes provided. Deduct your payment from your bank account automatically each month Street Address Visit americanexpress.com/autopay City, State todayto enroll, Zip Code Area Code and L a ae Home Phone Atea Code and For information on how we protect your Work Phone privacyand to set your communication Email and privacy choices, please vist ocmaccemend www.americanexpress.com/privacy. DUPLICATE COPY Delta Reserve for Business Credit Card “SIGMA CONSULTING LL ADELTA p. 3/5 KELLY RIEDEL = losing Date 10/25/13 Account Ending 5-34009 f | Payments and Credits | Summary Total Payments -$500.00 Credits $0.00 Total Payments and Credits -$500.00 _ [ Detail “Indicates posting date Payments Amount 09/28/13* ONLINE PAYMEN T- THANK YOU ~$500.00 a Fees Amount Total Fees for this Period $0.00 Interest Charged Amount Total Interest Charged for this Period $0.00 2013 Fees and Interest Totals Year-to-Date