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10/23/2007
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Medsphere Settles Lawsuit With Former CTO Over Open Source Code

The case centered on posting to SourceForge elements of OpenVista, which is a patient care and hospital operations system first used by the U.S. Veterans Administration.

A bitter open source dispute has been settled between Medsphere Systems, the company formed around the OpenVista health care system, and its former chief technical officer, Steve Shreeve.

On June 6, 2006, Shreeve posted elements of a medical system to SourceForge, an open source project site. The firm's CEO, Ken Kizer, and board of directors soon afterward claimed the posted code was company property and not intended to be made freely available. In a court filing four months later, Kizer asserted that Shreeve and his brother, Scott, former chief medical officer of Medsphere, were using the open source posting as a way to launch a rival company.

Steve Shreeve in turn charged that volunteer open source contributors and reviewers would not contribute work on code as long as he was being sued for making it public. "How is any open source developer going to have a shred of confidence to work on this?" he asked in a Feb. 5 story that included the dispute in Information Week.

A suit against the Shreeves was filed by the company in Orange County, Calif., Superior Court, charging them with violation of their fiduciary duty. The Shreeves denied the charges. While the case was still pending, Medsphere made the OpenVista system publicly available again in February.

Kizer is now chairman of Medsphere but has resigned as CEO. He has been replaced by Michael Doyle, a veteran of health care software. "It's behind us now," said Doyle of the lawsuit. The filing indicated the company was seeking $50 million in damages from the Shreeves.

He refused to divulge any details of a settlement with the Shreeves. Both were fired from their positions after the June 2006 dispute and are no longer associated with the company. Steve Shreeve could not be reached for comment.

OpenVista is an open source version of a patient care and hospital operations system first used by the U.S. Veterans Administration. Medsphere has modified the VA system for commercial hospital operations and built proprietary installation and file conversion techniques that help it earn revenue from the core system.

It's been installed at Midland Hospital in Midland, Texas, as well as in five associated West Virginia clinics and health care facilities and the Lutheran Medical Center in Brooklyn. It will go live at the Century City Medical Center in L.A. in December, Doyle said in an interview.

Doyle was trained as a hospital administrator at the University of Chicago, where he received his MBA degree, specializing in health care and finance. His first job was in health care as VP at the Norwood Hospital in Norwood, Mass.

Doyle founded and served as CEO of The Standish Care Co., a pioneer in assisted care living, and lead the company to a successful IPO in 1992. He served as president and CEO of AdvantEdge Healthcare Solutions, a New York firm offering outsourced physician billing. It supplied physician billing via software as a service.

OpenVista still offers the potential to give the health care system "an affordable, world-class, proven clinical information system," he said. Doyle said OpenVista.org, the open source project, was "starting to develop a community around the system" and Medsphere would work to encourage that community.

He predicted that Medsphere, as a purveyor and commercial supporter of OpenVista, "will help reduce the cost of health care ... and reduce medical errors."

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