Friday Health Plans, which is going out of business, is being sued by its co-founder and former COO David Pinkert for allegedly refusing to pay his severance package after he was terminated earlier this year.
Mr. Pinkert co-founded Denver-based Friday Health in 2015 and is named in the lawsuit as COO and secretary. He was terminated in November without cause, effective Jan. 13, 2023. In the lawsuit, filed June 2 in a Denver municipal district court, he said his contract with Friday Health included a severance package, which included his annual salary of $300,000 and other benefits.
According to the complaint, Friday Health said in the separation agreement it would pay Mr. Pinkert his severance package if he signed a release of claims against the company. The agreement also said that if any lawsuit occurred afterward, the winner would be entitled to attorney fees and costs.
After the first severance check did not come in early February, Mr Pinkert alleges his former employer said he would be not receiving any severance payments "due to liquidity concerns of the company at this time."
On June 1, Friday Health said it is shutting down its business nationwide through this year after several states moved to pause new enrollments or regulate the company's finances.
"Unfortunately, Friday has been unable to scale our financial infrastructure to match the pace of our growth and secure the additional capital required to run our business," the company wrote on its website. "While we are deeply disappointed, we agree with the decision of our state regulators that it is necessary to wind down Friday's business operations over time in accordance with the regulations in the states where we are operating."
In the lawsuit, Mr. Pinkert claims the company's former CFO had received severance payments after they left the company.
"Such payments call into question the veracity of Friday Health Plans purported basis for refusing to pay," the lawsuit said.
In May, Mr. Pinkert reached out to Friday's CEO, Beth Bierbower, about the situation, and claimed he was referred to the company's legal counsel.
Mr. Pinkert is seeking damages in an amount to be determined at trial, plus attorney fees, interest and costs.
Becker's has reached out to Friday Health Plans and will update this article if more information becomes available.