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For Immediate Release:  
For Further Information Contact:
August 22, 2005

Office of The Attorney General
- Peter C. Harvey, Attorney General
Division of Consumer Affairs
- Kimberly Ricketts, Director


Jeff Lamm, Genene Morris


Attorney General and Division of Consumer Affairs Reach $134,000 Settlement with Health Care Service Firm

NEWARK — O’Grady-Peyton International (USA) Inc., a health care service firm, has agreed to pay $134,000 and revise certain business practices so it complies with State regulations and the Consumer Fraud Act, under terms of a settlement announced today by Attorney General Peter C. Harvey and Consumer Affairs Director Kimberly Ricketts.

The Attorney General and Director Ricketts alleged that O’Grady-Peyton, which hires nurses and other health care practitioners for temporary positions in New Jersey medical facilities, failed to perform background checks and maintain required records in connection with certain placements. Under the terms of the settlement, the company has agreed to verify that the individuals it employs or places are properly licensed and to maintain its records in accordance with state regulations. Moreover, the settlement requires that O’Grady-Peyton disclose to its health care professionals what their working conditions and living arrangements will be in connection with temporary placements in New Jersey.

“Companies such as O’Grady-Peyton have an obligation to the public to thoroughly check the background of the health care professionals it hires and to verify that these doctors, nurses and other practitioners are properly licensed,” said Acting Governor Richard J. Codey. “This settlement clearly states what O’Grady-Peyton is required to do to safeguard the public.”

“New Jersey patients deserve care from properly trained and licensed medical professionals,” said Attorney General Harvey. “Although O’Grady-Peyton’s professionals hold temporary positions, that does not lessen the company’s responsibility to perform background checks and maintain records on them as required by State regulations. The same concern exists to ensure that patients are cared for by licensed, responsible practitioners.”

Under terms of the settlement. O’Grady-Peyton agreed to:

  • Within 60 days, have a record for each health care practitioner that contains all information required under state regulations;
  • Revise its employment agreements to eliminate provisions that require a health care practitioner to pay liquidated damages;
  • Refund $611.75 paid in liquidated damages by one employee;
  • Not attempt to bind a health care practitioner to a particular lease agreement or furniture rental agreement without the express written consent of the health care practitioner;
  • Provide copies of a particular lease agreement or furniture rental agreement to the health care practitioner before requiring the practitioner to be bound to it;
  • Disclose information about anticipated medical coverage to the health care practitioner prior to employment;
  • Obtain written consent from the health care practitioner for any paycheck deductions other than taxes and retirement savings.

“This settlement protects health care practitioners by setting specific disclosure requirements prior to their hiring,” Director Ricketts said. “We expect O’Grady-Peyton to abide by this agreement and to adhere to our regulations.”

Under the settlement, O’Grady-Peyton paid $130,000 as a civil penalty and $4,000 in reimbursement for costs incurred by Consumer Affairs.

Deputy Attorney General Brian M. Brennan represented the State in this matter.


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