Forge Ahead: Catania?s Greater Southeast bulldogging centered on a fraudulent letter that wasn?t quite that.
Forge Ahead: Catania?s Greater Southeast bulldogging centered on a fraudulent letter that wasn?t quite that. Credit: Darrow Montgomery

At-Large Councilmember David A. Catania has assigned himself the task of saving Greater Southeast Community Hospital.

It’s God’s work, as far as council duties go: Babysitting the troubled, perpetually money-losing hospital—the only full-service hospital east of the Anacostia—is a tough job with little visibility and a lot more political risk than potential payoff. It’s also not particularly conducive to the bloody-knuckle investigative throwdowns upon which Catania has staked his reputation.

But, occasionally, it can get good. On Sept. 26, Catania thought he had the makings of a truly great Perry Mason moment.

In late August, the city announced it had reached an agreement with former owners Envision Hospital Corp. and its widely loathed CEO, Paul Tuft, to sell Greater Southeast to Specialty Hospitals of America. The newsworthy part of the deal involved taxpayer dollars: The city was throwing in $79 million to make the deal happen.

As with any big-figure outlay of city money, there was controversy. The primary cries came from a failed bidder called Population Health Management Group. “The playing field was not level,” principal Burton Wheeler told the Washington Business Journal after the Specialty deal was inked.

And last Wednesday evening, more than four hours into a health committee hearing on Greater Southeast, Catania had in front of him Congress Heights rabble-rouser Sandra “S.S.” Seegars, who had been harping on Catania and Council Chairman Vincent C. Gray for negotiating the hospital agreement behind closed doors and for allegedly steering the contract to Specialty.

The main line of Seegars’ inquiry went to whether Population had been unfairly passed over. Catania and others had claimed that Population wasn’t a serious bidder, because, among other reasons, they’d yet to find anyone to actually run the hospital. Seegars’ proof to the contrary included an Aug. 22 letter from Providence Hospital President Julius Spears to Tuft explaining that the Michigan Park hospital was “actively engaged in formation of a partnership with [Population].”

After Seegars finished her testimony, which mentioned, among other things, her requesting an FBI investigation of the hospital deal, Catania commenced his examination: “Can you tell me, in what state was this company incorporated?” he began, referring to Population.

Seegars thought for a moment and replied, “If I’m not mistaken, it’s Maryland.”

“You would be mistaken, Ms. Seegars,” Catania fired back, “because this is a company that does not exist. There are no articles of incorporation for this company.”

Game on. Catania went on to claim that the Aug. 22 letter, portions of which had appeared in a Washington Business Journal article the week before, was a fraud, written by Joe Eaglin, another one of Population’s principals. Handily, Catania had Providence lawyer Rod Woodson on the witness stand next to Seegars to verify that the letter was “not approved by nor authorized by Providence.”

“Who produced this document and where it came from is not known to us. It is not authentic,” Woodson testified.

From there, the hearing degenerated to a whole bunch of shouting and gavel-pounding. LL recommends you log on to and check out the Channel 13 archives for highlights. (You want Part 2 of the Sept. 26 health committee hearing; fast-forward to 3:48.)

Now, Catania had plenty of reason to believe that the letter was bogus. He had last met with Wheeler and Eaglin on March 12, back when it was far from clear that the hospital would be opened for bids, since Maryland developer Carl Jones already had a claim to the Greater Southeast property. At the time, Population had not firmed up its financing or a partnership with a health-care provider, so Catania says he told them to come back when everything was in place. The only reason the meeting even happened, Catania says, was because Ward 8 Councilmember Marion Barry had vouched for Eaglin.

Over the summer, the Jones deal fell apart, leaving council and city officials to scramble to find another buyer for the hospital, but Catania never heard from Population again. Plus, there were plenty of rumblings about Eaglin’s reputation: At the hearing, Sharon Baskerville, executive director of the D.C. Primary Care Association, accused Eaglin of falsely listing her group as a partner on a grant application.

Baskerville was also upset to see her photograph and her organization listed as a partner on Eaglin’s company’s Web site, which was dismantled shortly after the hearing. “He puts together a lot of people, drops a lot of names.…I’ve just never seen anything of substance come to fruition,” she says.

Another reason to think the letter was bogus: The letter itself seemed like something only Dan Rather could believe. It was unsigned, for one thing, transmitted by e-mail. The letterhead appeared different from a genuine letter Spears had sent Tuft a week earlier—including an upside-down logo for Ascension Health, Providence’s corporate parent, at the bottom of the page. And the coup de grâce: The electronic metadata on the Microsoft Word file indicated that the letter had been written by “jeaglin” on the same day the Specialty agreement was signed, hinting that the letter might have been fabricated to at least delay any imminent deal.

But Catania’s bulldogging went a bit too far. For one thing, Population actually seems to be a legitimate corporate entity. LL checked the District’s online corporate registry, and Population registered as a limited liability company here in late July. (Before the hearing, a Catania staffer checked several online databases and called the city to check if Population had a business license but did not consult the corporate registry.)

The other half of the gotcha fell apart when Woodson backed off his characterization of the bogus letter. In a Washington Business Journal story Friday, Eaglin deemed the letter a draft that was mistakenly distributed at a mid-September meeting of Seegars’ advisory neighborhood commission. Woodson, a partner at Holland & Knight, said he didn’t know about it because it had been generated by Providence’s in-house legal counsel without his knowledge. Woodson did not return LL’s calls for comment.

Questions about the letter remain: What changes did Eaglin make to the letter? And just how accidental was it that the letter ended up in Seegars’ hands?

The due-diligence failures were not helped by the scoop’s last-minute timing. Catania staff didn’t learn of the letter’s existence until Sept. 24; that evening, a staffer contacted Woodson, who knew nothing about it. “Everyone hit the roof,” Catania says. The letter itself didn’t surface until the day of last week’s hearing.

Neither Catania nor any council staffer, Eaglin says, called him about the letter before the hearing. He says he didn’t hear about any of the allegations over the letter until that night.

At this point, the controversy is largely moot: The council voted unanimously Tuesday to move forward with the Specialty deal. Eaglin says he’s not pursuing anything related to Greater Southeast any further and declined to comment on Catania’s performance. “It’s over,” he says. “We’re not even going to respond to it.”

Seegars has no such reservations: “David is a liar,” she says. “I’ll be back down there.”

Catania has no regrets about his grilling of Seegars. “I’m not backing down or apologizing one bit,” he says. “[Population] got wirebrushed because they deserved to get wirebrushed.”

To the suggestion that he might have moved to theatrics too quickly, Catania says he would have done nothing differently: “This is not the time to cut the crusts off cucumber sandwiches here.”

Political Potpourri

• Surf on over to the Office of the Chief Financial Officer’s Web site and you’ll see two pictures: the smiling mug of CFO Natwar M. Gandhi and a photo of the John A. Wilson Building.

Right now, the longtime financial czar indeed enjoys super digs on the second floor of the Wilson Building, a flight of stairs and a short trot away from Mayor Adrian M. Fenty’s bullpen. Gandhi portrays himself as a nerdy bean-counter, but he’s well-known for traipsing around the building’s hallways and enjoying frequent breakfasts around the corner at Old Ebbitt Grill.

But under a plan floated earlier this year by the city’s Office of Property Management, the CFO’s office, along with the Department of Consumer and Regulatory Affairs, would be moved from various spots across the city, including One Judiciary Square and the North Capitol Street towers now housing the D.C. Public Schools and DCRA, to a new 500,000-square-foot space near the Southwest waterfront by late 2009.

The big question: Will the CFO office move actually include the CFO?

LL guesses the charms of the Southwest waterfront—walks along the harbor promenade, plays at Arena Stage, the all-you-can-eat buffet at Phillips Flagship—would appeal somewhat less to Gandhi, who could not be reached for comment.

Spokesperson Maryann Young says the most recent plans do not include moving the executive portion of the office, but that has more to do with the budget analysts housed there than Gandhi’s preferences. “We’re sort of a customer-service function for the council,” she says.

• On Sept. 21, Ward 3 Councilmember Mary Cheh went down to the D.C. fire academy down in Blue Plains on an investigative junket. There, she had the opportunity to take the department’s physical ability test.

The test, which all new recruits have to pass, involves climbing up and down a fully extended rescue ladder, then donning protective gear and opening and closing a hydrant, placing and replacing a ladder, dragging a water-filled hose, carrying a 50-some-pound sack up and down six flights of stairs, and navigating a maze while essentially blindfolded.

Cheh, 57, passed handily. Department standards require a recruit to finish the course in under 22 minutes. Cheh finished it up in under 15.

To be fair: Cheh, while small-framed, is an avid runner. But does it alarm the District’s public-safety establishment that a 5-foot-4, 57-year-old woman could ace the department’s fitness test?

Fire department spokesperson Alan Etter says he’s “not at all surprised” Cheh passed the test. “She seems to be a fit, nimble individual,” he says.

Says Cheh of the test, “It could be more rigorous. Whether it has to be or not, I’m not sure.”

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