Reditus Labs to be placed in receivership as new Rossi misconduct allegations come to light

Published: Apr. 14, 2022 at 1:12 PM CDT|Updated: Apr. 14, 2022 at 4:51 PM CDT
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TAZEWELL COUNTY (WEEK) - A judge in Tazewell County is signing off on an agreed-upon receivership of Reditus Laboratories. The agreement was finalized during a three hour hearing Thursday in a civil case against company CEO Aaron Rossi.

This receivership means control of the company and its finances are placed in the care of an agreed-upon “receiver.” That is Adam Silverman of Chicago-based Adleman & Gettleman Ltd. Jim Keane of Harney Partners, also out of Chicago will support with management of the company.

This is the next step in the lawsuit filed in March 2021 by Rossi’s shut-out business partner Dr. Jim Davie.

Neither Dr. Davie or Rossi were present in the courtroom, but there are upwards of 20 attorneys on record in this court proceeding. It took Judge Chris Doscotch about 20 minutes to sort through all the attorneys and who they represent. Eventually, attorney Rob Hanauer, who represents Dr. Davie, joked, “It’s hot with all of these attorneys up here. A lot of hot air.”

The attorneys in the courtroom Thursday included Don Craven, who is representing a group of the local news agencies, including 25 News. The group of media outlets is asking the judge to lift the protective order that has many details of this case under seal. Rossi’s attorneys have filed a motion to dismiss Craven, but because the case is sealed, we cannot see those motions.

The media driven goal of removing the protective order is compelling public interest in this matter. Reditus Laboratories received more than $220 million in state contracts for handling COVID-19 PCR test results. The community interest is probably the biggest reason Dr. Davie’s attorneys sought the receivership, to protect the company and its financial viability for the more than 300 people it employs and its footprint in Pekin.

But you might wonder why Rossi’s own attorneys would agree to turning the company over to somebody else. The answer to that might rest, at least in part, with the allegations Rossi faces from the Illinois Department of Financial and Professional Regulation (IDFPR).

According to two documents obtained by 25 News in a Freedom of Information Act request, the agency filed a formal complaint alleging Rossi committed a bevy of professional wrongs in January and more brought more allegation in March. Rossi holds only a surgical assistance license, not a medical license.

IDFPR asserts during a 22-month period starting in October 2016 to July 2018 in which Rossi was employed at Central Illinois Orthopedic Surgery (CIOS), he wrote at least 28 different prescriptions without authorization on the company’s electronic prescription system. They were for various controlled substances, mostly opioids including hydrocodone, amphetamines, tramadol and oxycodone. In total, he prescribed 2,890 pills.

The documents also say, “at all times relevant to during the Complaint, Respondent was not authorized or licensed to issue or write prescriptions.” In addition to revoking his license, which expires May 31, 2022, he could be fined up to $10,000 per violation.

Another section in the seven-count complaint describes 13 different instances Rossi is accused of misusing CIOS’s funds, mostly using the CIOS’s Chase Bank checking account without authorization.

The two largest expenditures include $25,000 to ‘Sound Choice’ hearing clinic and another $25,000 to Carole Schoenfeld, who at the time, was the owner of the company Rossi now owns, PAL Heath Technologies. The lion’s share of the payments were made to Bloomington John Deer Dealership, “AV Preperformance,” custom home theater company, and “Sound Choice”. The document says these acts constitute, “willfully making or signing a false statement, certificate, or affidavit to induce payment.”

The complaint amended in March offers another statements seemingly not directly related to any of the charges, but significant nonetheless. It reads, “his acts constitute, ‘immoral conduct in the commission of an act related to the registrant’s practice, including but not limited to sexual abuse, sexual misconduct, or sexual exploitation.”

It’s unclear when IDFPR will rule on Rossi’s case. Meanwhile, the Dr. Davie v. Rossi lawsuit is scheduled to be back in court May 2. We anticipate learning more about whether the protective order will be removed at that time.

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