Echo Therapeutics (NSDQ:ECTE) today said it agreed to settle an ongoing dispute with former president & CEO Dr. Patrick Mooney that arose after his sudden departure in August 2013.
Mooney, a surgeon by training before he headed to the world of high finance and Wall Street, had been running things at Echo since a 2007 merger with Sontra Medical. He and his wife Elizabeth Mooney 1st sued Echo for more than $20 million in February 2014, claiming that his allegedly without-cause termination entitled him to severance benefits, defamation by Echo and its general counsel and loss of consortium, according to a regulatory filing. Echo filed a counterclaim “based upon the same conduct which provided the cause for [Mooney’s] termination,” later restructuring those claims, according to the filing.
The Mooneys sued again in July of last year, alleging wrongful use of civil proceedings and abuse of process in Echo’s original counterclaim filing, asserting another loss of consortium claim and seeking $30 million in damages.
A month later Mooney sued again, seeking to have Echo cover his legal fees from the original complaint, “many of which we had paid to date and the remainder of which were subject to a good faith dispute that counsel for our company and Dr. Mooney had been attempting to amicably resolve,” Echo said. Mooney also sought recompense for legal fees from the July action, the company said.
But today the company said it agreed to settle all the cases for a $150,000 payment to Mooney, plus unspecified additional payouts from its insurers.
Philadelphia-based Echo Therapeutics tapped board member Robert Doman for interim CEO after Mooney’s departure, replacing him in June 2014 with senior vice president, general counsel, chief compliance officer & secretary Kimberly Burke. In December 2014 Echo put former Otsuka Pharmaceuticals exec Scott Hollander in the corner office; Burke resigned later that month.
