Ex-Medical Manager executive enters guilty plea


Published: Wednesday, January 25, 2006 at 6:01 a.m.
Last Modified: Tuesday, January 24, 2006 at 9:18 p.m.

A former Medical Manager executive, expected to be a witness in a pending federal case against millionaire software developer Michael "Mickey" Singer, entered a guilty plea in South Carolina on Monday to conspiracy to inflate the company's reported earnings.

Facts

AT A GLANCE: Court action

  • Michael "Mickey" Singer and nine others indicted in the case entered not guilty pleas to the allegations in a South Carolina courtroom in January.

  • Henry W. Holbrook, 51, of Westfield, Mass., the former regional vice president for the northeast region of Medical Manager, agreed to pay $1.5 million to the government as part of the plea deal, according to court records.

    Assistant U.S. Attorney Kevin M. McDonald called Holbrook "an important witness" in the case against 10 former officers and employees of the Emdeon subsidiary Emdeon Practice Services, which was formerly known as Medical Manager Health Systems. They were indicted last month and accused of conspiring to fraudulently inflate the business' earnings.

    Among them is Singer, 58, who founded Medical Manager in Alachua in 1981.

    Four former Medical Manager executives entered guilty pleas last year in connection with the case before the U.S. Attorney's Office in Charleston, S. C., announced the indictment.

    Holbrook, who was not named in the recent indictment, signed paperwork agreeing to a plea last month to avoid indictment, McDonald said. The agreement includes a requirement that Holbrook "be fully truthful" with investigators.

    Holbrook's South Carolina attorney John Barton said that his client "is ready to cooperate and will do so."

    Holbrook, acting with and at the direction of senior Medical Manager officers, allowed sales revenue to be prematurely recorded, court records state. As a result, Medical Manager and WebMD's earnings were fraudulently inflated by at least $16.8 million from 1997 to 2001.

    When Singer's indictment was announced, one of his attorneys, Washington-based Randall J. Turk, said government witnesses testified in the case to receive reduced sentences and persuaded prosecutors "that the entire executive team should be held responsible for their actions." Reached Tuesday, Turk did not comment further.

    Singer and nine others indicted in the case entered not guilty pleas to the allegations in a South Carolina courtroom in January.

    A date for Holbrook's sentencing and for a trial in the case against the other Medical Manager executives has not been set.

    Holbrook also pleaded guilty to one count of tax evasion.

    Holbrook faces a maximum sentence of five years in a federal prison on both charges, plus thousands of dollars in fines.

    Singer resigned last year from the company, which was purchased by WebMD Corp. in 2000.

    Lise Fisher can be reached at (352) 374-5092 or fisherl@ gvillesun.com

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